IFRS 13 · Case studies (Step 3 of 5)
Practical case
Sélvane Industrie SA, a fictitious company that manufactures industrial pumps, IFRS financial statements, year end 31 December, amounts in euros. It holds metal stocks, a plot of land, quoted shares, an unlisted holding, a warehouse and financial instruments.
L1 · Guided · Year N — year end at 31 December N
You progressively build Sélvane's fair value file: scope and choice of market (level 1, N), highest and best use, quoted prices and hierarchy (level 2, N), liabilities, techniques and day-one difference (level 3, N+1), then disclosures, frozen market and revaluation (level 4, N+1). Figures, weights and assumptions are case data; weights and significance are judgments; no method chosen for the case is presented as imposed by the standard. Teaching assumption: rounded amounts.
Standard involved: IFRS 13 Fair Value Measurement. Sélvane is preparing the measurement of its items at year end. Start with scope and the choice of market, then calculate a first fair value. The questions are guided.
Fundamental level: the method, help and references are shown.
Method
File checklist
2 / 6 stages reached
Context · Dated fact of the file
Sélvane Industrie SA, a fictitious company that manufactures industrial pumps, IFRS financial statements, year end 31 December, amounts in euros. It holds metal stocks, a plot of land, quoted shares, an unlisted holding, a warehouse and financial instruments.
Initial event · L1·Year N — year end at 31 December N · Current stage
Standard involved: IFRS 13 Fair Value Measurement. Sélvane is preparing the measurement of its items at year end. Start with scope and the choice of market, then calculate a first fair value. The questions are guided.
Pieces added
New information · L2·Year N — year end at 31 December N · Upcoming: unlocks after the current stage
New period · L3·Year N+1 — year end at 31 December N+1 · Upcoming: unlocks after the current stage
New information · L4·Year N+1 — year end at 31 December N+1 · Upcoming: unlocks after the current stage
Conclusion · Upcoming: unlocks after the current stage
1 document to work from at this level.
Document 1Supporting document
For the items below, another standard requires or permits fair value (case data) unless stated otherwise.
| Item | Data |
|---|---|
| A. 300 tonnes of steel billets held at the warehouse | Location far from markets, a characteristic of the asset |
| B. Share option plan for managers | Share-based payment |
Markets for the billets (per tonne)
| European market | Asian market | |
|---|---|---|
| Price | 700 | 760 |
| Transaction costs | 15 | 30 |
| Transport costs | 25 | 60 |
| Volume and activity | Highest; Sélvane usually sells there and has access | Lower; accessible |
First level: all the data is in the brief and the pieces of this level.
4 parts to answer, marked when you submit the level.
Find the useful facts in the pieces before concluding.
Part 1 · Multiple choice · Recognition
Which item is excluded from the IFRS 13 measurement framework?
3 more questions will appear once the current question is complete.
Your working draft for this file: points noted, leads, intermediate calculations.
Saved on this device only; never graded.
Answer every part to submit the level and see the conclusion.
Normative references