Asset Valuation. The auditor must consider how asset valuation models like historical cost, current or fair value accounting will be affected by the realities of the twenty-first century.

Furthermore, the auditor should consider regulations which create special assets (such as an emission right), which are difficult to value under traditional techniques.

Required

A. Define historical cost, current, fair value, impaired asset and emission right.

B. For each of these four concepts describe the problems of their use for asset valuation.