IFRS 13Chapter 10Lesson 1
Inputs: observable or not, premiums and discounts, bid and ask prices
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Techniques maximise observable inputs and minimise unobservable ones. Inputs are consistent with the item's characteristics; a blockage discount related to the size of the position is not permitted; between bid and ask, the most representative price is used.
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Learning objectives
- Distinguish observable and unobservable inputs and justify the priority given to the former.
- Assess whether a premium or discount is a characteristic of the item or results from the size of the position, which is excluded.
- Determine the price within the bid-ask range that is most representative of fair value.