CERTYNEX IFRS ACADEMY

Savelin holds securities whose sale in their principal market would bring in 50,000 at the reporting date. Management plans to hold them for five years and proposes to measure them at 42,000 "since we will not sell them". Which amount represents fair value?

42,000, because the intention to hold the securities reduces their value for the entity.

50,000, the exit price in the principal market, whatever management's intention.

46,000, the average of the two amounts.

No amount: as long as the securities are not sold, there is no fair value.