CERTYNEX IFRS ACADEMY

The transaction price of an instrument is its fair value at initial recognition, and the entity will subsequently use a technique with unobservable inputs. Why does it calibrate that technique?

To show a profit at the date of initial recognition.

So that its initial result equals the transaction price and reflects current market conditions.

To replace the unobservable inputs with Level 1 inputs from the first date.

So as no longer to have to check the technique at subsequent reporting dates.