Business identifier code and Cost approach: Difference between pages
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''Financial reporting - fair value''. | |||
IFRS 13 Fair Value Measurement defines a 'cost approach' as a valuation technique that reflects the amount that would be required currently to replace an asset with a comparable asset which would provide the same future stream of services. | |||
A cost approach to fair value identifies the price that would be received for the asset based on the cost to a [[market participant]] buyer to acquire or construct a substitute asset of comparable utility, adjusted for obsolescence. | |||
This is sometimes known as the current replacement cost. | |||
==See also== | ==See also== | ||
*[[ | *[[Fair value]] | ||
*[[ | *[[IFRS 13]] | ||
*[[Income approach]] | |||
[[Category: | [[Category:Accounting,_tax_and_regulation]] | ||
Revision as of 20:46, 27 June 2022
Financial reporting - fair value.
IFRS 13 Fair Value Measurement defines a 'cost approach' as a valuation technique that reflects the amount that would be required currently to replace an asset with a comparable asset which would provide the same future stream of services.
A cost approach to fair value identifies the price that would be received for the asset based on the cost to a market participant buyer to acquire or construct a substitute asset of comparable utility, adjusted for obsolescence.
This is sometimes known as the current replacement cost.
