IFRS 13Chapter 9Lesson 1
Valuation techniques: approaches, selection, weighting, calibration and present value
Step 1 of 5Learning objectives
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The entity uses techniques appropriate to the circumstances and maximises observable inputs. Three approaches exist (market, cost, income); several techniques may be weighted, calibrated to the transaction price and applied consistently.
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Learning objectives
- Distinguish the market, cost and income approaches and the data they use.
- Justify the choice of techniques and calculate a fair value as a weighted average of indications.
- Calculate a calibration adjustment and a present value using two techniques (adjusted rate, expected present value).
- Assess whether a change of technique is appropriate.