Question bank — IFRS 13 — Fair Value Measurement
178 questions in FR/EN/ES, scored by the real scoring engine.
Purpose and nature: a market-based measurement4 questions
- Fair value under IFRS 13 is the value the entity assigns to an asset given the use it intends to make of it.True / falseL1
- What is the objective of IFRS 13?Single choiceL1
- A colleague writes in a memo: "Under IFRS 13, the fair value of our land is the one that reflects management's plan; it is an entity-specific measurement." What is wrong with this sentence?Single choiceL1
- When no price is observable, the objective of the measurement remains to estimate the exit price at the measurement date, from a market participant's viewpoint.True / falseL1
When IFRS 13 applies5 questions
- IFRS 13 specifies in which cases an entity must measure its assets at fair value.True / falseL1
- In which case does the IFRS 13 measurement framework apply?Single choiceL1
- Corvesne's accounting procedure states: "IFRS 13 requires us to measure our property, plant and equipment at fair value every year." What is the error?Single choiceL1
- To which measurements does the IFRS 13 framework apply when another standard requires or permits fair value?Single choiceL1
- Since the definition of fair value focuses on assets and liabilities, IFRS 13 never applies to the entity's own equity instruments.True / falseL1
Scope exclusions4 questions
- A share-based payment expense within IFRS 2 is measured under the IFRS 13 measurement framework.True / falseL1
- Which of these measures resembles fair value without being fair value within the meaning of IFRS 13?Single choiceL1
- For its inventories, Valtrenne writes: "Our net realisable value is a fair value within the meaning of IFRS 13, so we apply the IFRS 13 framework." What is the error?Single choiceL1
- Which of these transactions is excluded from the IFRS 13 measurement and disclosure scope?Single choiceL1
Disclosure exemptions2 questions
- Under IFRS 13, for which items is the entity exempt from the standard's disclosures while still having to measure them under the framework? (Several answers.)Multiple choiceL2
- Montaubry's closing file states: "The assets of our retirement plan are exempt from IFRS 13 disclosures; therefore they need not be measured under the IFRS 13 framework." What is the error?Single choiceL2
The exit price4 questions
- Fair value is the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date.True / falseL1
- Linde bought a machine for 120,000 a year ago. At the reporting date, selling this machine in its principal market to a market participant would bring in 95,000. Which amount corresponds to the fair value of the machine?Single choiceL1
- Which characteristics correctly describe the fair value of an asset under IFRS 13? (Several answers.)Multiple choiceL2
- At 31 December, Orsanne measures a liability using a transfer price observed on 30 September, ignoring the market conditions at 31 December, on the grounds that "the nature of the price has not changed". What is the error?Single choiceL2
Market participants4 questions
- How does the entity deal with the notion of market participants when measuring an asset?Single choiceL2
- Which characteristics does the entity use to describe market participants? (Several answers.)Multiple choiceL2
- Raffinerie Dalmour holds a patent. Only it could derive an extra gain of 40,000 from synergies with its own plant; no other market participant could benefit from it. To measure the patent at fair value, what does Dalmour do with this 40,000 gain?Single choiceL2
- The Verdane laboratory measures at fair value a licence on a molecule intended for a niche market. Describe in a few lines the characteristics of the market participants Verdane uses for this asset, and justify why their assumptions, rather than Verdane's, are used to set the price.JudgmentL2
The entity's intention is irrelevant2 questions
- If the entity intends to keep an asset until the end of its useful life, that intention reduces the asset's fair value compared with the market exit price.True / falseL2
- 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?Single choiceL2
Characteristics of the asset or liability3 questions
- To set the price of a plot of land, which items does the entity take into account if market participants would themselves take them into account? (Several answers.)Multiple choiceL2
- To measure a building, Garrick applies a 10% discount because the entity's loan agreement forbids it from selling the building within five years. This ban would not follow the building to a buyer. What is the error?Single choiceL2
- To prepare the fair value measurement of a warehouse, an analyst looks for the overall approach to which IFRS 13 refers. What does this approach cover?Single choiceL2
The unit of account4 questions
- Who sets the unit of account of an asset or liability measured at fair value?Single choiceL2
- Depending on the unit of account set by the applicable standard, the item measured at fair value may be: (Several answers.)Multiple choiceL2
- Prunelle's measurement procedure states: "IFRS 13 lets us freely choose, for each item, the unit to measure: we use the one that makes the team's work easier." What is the error?Single choiceL2
- The standard applicable to Vallorge's portfolio of receivables requires it to be measured at fair value and treats the whole portfolio as the unit of account (case data). The team measures each receivable separately and then adds them up. What should the team do?Single choiceL2
The principal market5 questions
- What is the principal market of an asset within the meaning of IFRS 13?Single choiceL2
- Which statements about the principal market are correct? (Several answers.)Multiple choiceL2
- Arvenne sells copper. Market X has the largest volume and the highest level of activity; the price there is 100 per lot. Market Y, smaller and thinly traded, would offer 104 per lot. Arvenne has access to both markets at the measurement date. Which price does it use for the fair value of a lot?Single choiceL2
- Market Z is the principal market of Hallevin for its tin lots. Brindelle, which has no access to Z at the measurement date, writes: "Our principal market is also Z, since it is Hallevin's." What is the error?Single choiceL2
- Which statements about the transaction assumed by a fair value measurement are correct? (Several answers.)Multiple choiceL2
The most advantageous market5 questions
- In which case does the entity use the price of the most advantageous market to measure an asset?Single choiceL2
- Tolvane sells a lot of wheat; there is no principal market. Market A: price …, transaction costs …, transport costs …. Market B: price …, transaction costs …, transport costs …. Compute the net amount of each market, then the net amount of the most advantageous market.CalculationL2Variant
- Rovelle trades steel plates; there is no principal market. Market A: price …, transaction costs …, transport costs …. Market B: price …, transaction costs …, transport costs …. Compute the net amount of each market, then that of the most advantageous market.CalculationL2Variant
- For a lot of copper with no principal market, Estrelle compares two markets. A: price 600, transaction costs 18, transport costs 12. B: price 610, transaction costs 30, transport costs 24. The location of the lot is a characteristic of the lot (case data). What is the fair value of the lot?Single choiceL2
- To designate the most advantageous market for a lot of cocoa, an analyst compares gross prices: A at 800 (transaction costs 20, transport 10) and B at 810 (transaction costs 45, transport 30). He selects B. What is the error?Single choiceL2
Transaction costs5 questions
- To obtain the fair value of an asset, the price in the principal market is reduced by the transaction costs the entity would bear in selling it.True / falseL2
- Why is the market price not reduced by transaction costs to set fair value?Single choiceL2
- The principal market for a lot of Maréval securities shows a price of …. By selling it, Maréval would bear … of transaction costs. Compute the fair value of the lot and the net proceeds Maréval would receive.CalculationL2Variant
- An industrial press of Norvaux is quoted at … in its principal market. Selling it would involve transaction costs of …. Determine the fair value of the press and the net proceeds of sale.CalculationL2Variant
- Which statements about transaction and transport costs are correct? (Several answers.)Multiple choiceL2
Transport costs3 questions
- Quérande's natural gas is stored at a remote site; location is a characteristic of the asset (case data). The market price is …; delivery to the market would cost … and transaction costs would be …. Compute the fair value.CalculationL2Variant
- Pélerande's silver ingots are held in a remote vault; their location is a characteristic of the asset (case data). Market price: …. Transport costs to the market: …. Transaction costs: …. Compute the fair value.CalculationL2Variant
- For wine barrels stored in a cellar far from the market, Cortelle uses the quoted market price as fair value, with no adjustment, although location is a characteristic of the barrels (case data). What is the error?Single choiceL2
Highest and best use4 questions
- Among which uses is the highest and best use of a non-financial asset assessed?Single choiceL3
- Brévanne's land is used as an industrial depot, with a value of …. Market participants could use it for residential purposes: market value of that use …, before deducting conversion costs of …. The three conditions (physically possible, legally permissible, financially feasible) are met for both uses (case data). Compute the net value of the residential use and then the value under the highest and best use.CalculationL3
- Calvenne's land is zoned industrial; this zoning rule applies to every market participant (case data). Net values of each use: current industrial depot 1,200,000; logistics warehouse, permitted and feasible, 1,350,000; housing, 1,850,000 but prohibited by zoning. Which value reflects the highest and best use?Single choiceL3
- Delmare holds a trademark it does not want to exploit, to prevent a competitor from using it. A valuer proposes to measure the trademark at a near-zero value since Delmare does not exploit it. Write a reasoned analysis of the highest and best use to use for fair value.JudgmentL3
The valuation premise1 question
The liability transfer assumption4 questions
- What assumption does IFRS 13 use to measure an entity's liability at fair value?Single choiceL3
- Which statements about the fair value measurement of a liability are correct? (Several answers.)Multiple choiceL3
- For the fair value of its warranty provision, Brasselle uses the amount it would have to pay the customer to extinguish the obligation, on the grounds that "the liability thereby disappears from our books". What is the error?Single choiceL3
- Zendrale has a site restoration obligation. No transfer market is observable. The regulator would accept a settlement of 900; a market participant taking over the obligation would require 1,050 according to the estimate made (case data). Which amount does Zendrale use for the fair value of the liability?Single choiceL3
Item held by another party as an asset2 questions
- No quoted price exists for the transfer of one of the entity's liabilities, but an identical item, held as an asset by another party, is quoted in an active market. What does the entity do to measure its liability?Single choiceL3
- Pelisanne issued a bond. A third party holds an identical security as an asset, quoted at 98 per 100 of nominal. This price includes a feature specific to the asset held that does not apply to the corresponding liability and that raises the price by 3 (case data). Which price does Pelisanne use for its liability, per 100 of nominal?Single choiceL3
Item not held by another party as an asset3 questions
- Kerlane has a dismantling obligation for which no quoted price exists and which no third party holds as an asset. A participant who would assume the obligation would bear an expected outflow of … in … years; the discount rate it would use, including its risk compensation margin, is …% (case data). Compute the fair value of the liability using present value.CalculationL3
- No quoted price exists for the transfer of the liability and no third party holds it as an asset. How does the entity measure it?Single choiceL3
- For a clean-up obligation with no quoted price, an analyst computes the present value of the outflows Fontvane expects to bear, with no margin added, on the grounds that "Fontvane asks for no compensation for its own debt". What is the error?Single choiceL3
Non-performance risk5 questions
- Marvenne must pay … in … years under a liability with no quoted price. The discount rate reflecting its own credit risk is …%; without that risk it would be …% (case data). Compute the fair value of the liability taking non-performance risk into account, then the effect of that risk compared with a measurement excluding own credit risk.CalculationL3
- Quillane must pay … in … year under a liability with no quoted price. Its credit rating having deteriorated, the discount rate reflecting its own credit risk rises from …% to …% (case data). Compute the fair value of the liability after the deterioration, then its change compared with the previous situation.CalculationL3
- What does the non-performance risk of a liability cover and how is it assumed to behave on transfer of the liability?Single choiceL3
- Norvenne, with an average rating, measures its liability assuming the taker-over would be a top-tier bank, with a credit risk far better than its own, which would reduce the effect of non-performance risk. Which assumption about credit risk must Norvenne use?Single choiceL3
- An auditor asks Sallane why the fair value of its loan with no quoted price takes Sallane's own credit risk into account, and why the same risk is used before and after the assumed transfer of the loan. Write a reasoned answer for the audit file.JudgmentL3
Transfer restrictions1 question
Demand feature3 questions
- Torvane's demand deposit must be repaid at the earliest in … years for … (first possible demand date); discount rate …% (case data). A valuation technique gives …. Compute the discounted demand amount and then the fair value of the financial liability.CalculationL3Variant
- Mirelane received funds from its customers: the sum of … can be claimed at the earliest in … years (first possible demand date). At the discount rate of …% (case data), a valuation technique for this financial liability gives …. Determine the discounted demand amount, then the fair value of the liability.CalculationL3Variant
- A demand deposit of 500 is repayable immediately. A valuation technique gives 470, and the accountant uses 470 as fair value on the grounds that "the deposit earns less than the market rate". What is the error?Single choiceL3
The net exposure exception6 questions
- On what condition may an entity measure a group of financial assets and liabilities on the basis of the price of a net position?Single choiceL4
- Which statements about the portfolio exception (net position) are correct? (Several answers.)Multiple choiceL4
- Auvrane bank manages a group of instruments exposed to the same market risk on the basis of its net exposure, with documented management and reporting to management on that basis; each item is measured at fair value at the reporting date (exception conditions met, case data). The long positions are worth … and the short positions … (at market price). Compute the group's net position.CalculationL4
- Vessolane bank measures a group of derivatives on the basis of a net position "to simplify valuation", although there is no documented management of the group on a net basis and management is not informed on that basis. What is the error?Single choiceL4
- Ormelane bank applies the portfolio exception to a group of swaps meeting all the conditions. A director concludes that it must now present these swaps net (a single amount) in the statement of financial position. What is the right answer?Single choiceL4
- Hérandelle bank manages its interest-rate swap portfolio on the basis of net market-risk exposure: written management policy, daily management reports based on net positions, each swap measured at fair value at the reporting date. It plans to apply the portfolio exception. Write a reasoned analysis: conditions met, consistency over time, effect on presentation and disclosure.JudgmentL4
Scope of the exception2 questions
- Which contracts fall within the scope of the portfolio exception?Single choiceL4
- Mercanelle trades a forward contract to buy copper that falls within the scope of IFRS 9 but does not meet the IAS 32 definition of a financial asset or liability (case data). The entity otherwise manages its net market-risk exposures in a documented way. Can this contract be part of the group measured on the basis of a net position?Single choiceL4
Measuring the net position4 questions
- Tiremane bank's group meets the conditions of the portfolio exception. Its long positions are worth … and its short positions … (at market price), exposed to substantially the same market risks. Applying to the net position the price within the bid-ask spread that is most representative of fair value gives an adjustment of … (to be deducted, case data). Compute the net position and then its fair value.CalculationL4
- Sauvelane bank must allocate a portfolio adjustment of … (decrease in value) to the three items of the group, with gross amounts of …, … and …. Case convention: allocation in proportion to each item's gross amount, the basis being used consistently. Compute the share of the adjustment allocated to each item.CalculationL4
- For long and short positions to be offset in the net position for market risk, what is required?Single choiceL4
- Cantelane bank entered into two derivatives with the same counterparty, covered by a netting and collateral agreement that limits the exposure to that counterparty's credit risk (case data). How does it assess that credit risk in the measurement of the net position?Single choiceL4
Transaction price and fair value3 questions
- At initial recognition, why may the transaction price differ from fair value?Single choiceL3
- Fordane acquires an instrument for …. A valuation technique for the exit price, based on observable inputs, gives … at the acquisition date. Compute the difference between fair value and the transaction price (positive: fair value above the price paid).CalculationL3
- The Brélane fund acquires a financial instrument for … in cash. The fair value at the acquisition date, from a technique based on observable inputs, is …. Fair value is required at initial recognition and no provision of another standard requires the difference to be deferred (case data). Record the acquisition entry.Journal entryL3
The day-one difference6 questions
- If fair value is required at initial recognition and differs from the transaction price, what does IFRS 13 provide for the difference?Single choiceL4
- Which statements about the day-one difference (fair value − transaction price) are correct? (Several answers.)Multiple choiceL4
- Moldrane bank acquires a security for …. Its fair value at the acquisition date is …, required at initial recognition. No provision of another standard requires the difference to be deferred (case data). Compute the day-one gain recognised in profit or loss and the initial carrying amount of the security.CalculationL4
- In his closing file, an accountant writes: "IFRS 13 requires the day-one difference to be deferred in a liability and released to profit or loss over the life of the instrument." What is the error?Single choiceL4
- Quenlane bank acquires an instrument for … in cash. Its fair value at the acquisition date is …. Case data: the standard applicable to the instrument requires the day-one difference to be deferred, because fair value rests on unobservable inputs. Record the acquisition entry.Journal entryL4
- Rivelane bank acquires a portfolio of receivables for 970,000; its fair value, required at initial recognition, is 1,000,000 under a technique based on unobservable inputs. To decide the treatment of the 30,000 difference, what must the bank rely on?Single choiceL4
Market, cost and income approaches3 questions
- Valtrin estimates the fair value of an interest in an unlisted company by applying to its earnings the multiples observed in recent sales of comparable companies. Which valuation approach does this correspond to?Single choiceL2
- For a highly specialised machine, a valuer estimates what it would cost today to replace its service capacity, then allows for the wear and obsolescence of the unit being valued. Which approach is being applied?Single choiceL2
- Which of the following statements about the income approach are correct?Multiple choiceL2
Selecting and weighting techniques5 questions
- For an instrument, Mervale has observable prices for comparable items and internal cash flow forecasts. What does the standard provide for the choice of valuation technique?Single choiceL3
- An entity applies several valuation techniques to the same instrument and obtains different results. Which statements are consistent with the standard?Multiple choiceL3
- Lorvane values an unlisted interest using two techniques: the market approach gives … and the income approach …. After assessing their relevance and reliability, the valuer uses (case data) weights of … and …. Compute the weighted fair value.CalculationL3Variant
- For an operating building, Dorvik obtains three indications: … (market), … (income) and … (cost). Based on its assessment of the relevance and reliability of each technique (case data), it gives them weights of …, … and … respectively. What is the fair value retained?CalculationL3Variant
- In a file review, a controller examines four valuation practices. Which one is contrary to the expected approach?Single choiceL3
Calibration3 questions
- At the acquisition date, Brelinde pays … for an instrument, a price it regards (case data) as its fair value at initial recognition. It will then measure the instrument using a model with unobservable inputs, which gives … at that date. Compute the calibration adjustment that makes the model's initial result equal to the transaction price.CalculationL4
- 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?Single choiceL4
- A model with unobservable inputs gives 4,100,000 at the acquisition date of an instrument paid 4,300,000, a price regarded as its initial fair value (case data). Which of these analyses of calibration is wrong?Single choiceL4
Changing a technique3 questions
- During the year, an entity considers dropping the technique it used to measure an instrument. In which case is the change appropriate?Single choiceL3
- A management controller reviews four decisions about the valuation technique for the same portfolio. Which one is open to challenge?Single choiceL3
- Halvane measured a portfolio of unquoted shares using a given valuation technique. Case data: new market information arising in the year makes another technique more representative of fair value, and Halvane changes to it. How is the resulting revision of fair value treated?Single choiceL3
Present value techniques5 questions
- An instrument will provide a single cash flow of … in …. The rate observed on comparable items with similar cash flows is …. Using the discount rate adjustment technique, compute the instrument's fair value.CalculationL3Variant
- A receivable from a third party will pay … at maturity, in …. Comparable items with similar cash flows are discounted at the observed rate of …. What fair value does the discount rate adjustment technique give?CalculationL3Variant
- To value an asset using the expected present value technique, an entity uses (case data) three possible annual cash flows: … with a probability of …, … with … and … with …. Compute the expected cash flow, before discounting.CalculationL3
- Which of the following statements about present value techniques are consistent with the standard?Multiple choiceL3
- An analyst values an asset by discounting forecast cash flows in current money, inflation included, at a real market interest rate. What is the flaw in this calculation?Single choiceL3
Observable and unobservable inputs4 questions
- Which general rule applies to the inputs used by a fair value valuation technique?Single choiceL2
- Which of the following sources can provide prices used as observable inputs?Multiple choiceL2
- In a review of a valuation file, a controller examines four practices relating to inputs. Which one is contrary to the standard?Single choiceL2
- To value a debt security, Salvane uses a model whose inputs are: (1) an interest rate published daily by dealers in their market and (2) a margin set internally, with no reference to market data. How should the entity treat these two inputs?Single choiceL2
Premiums and discounts4 questions
- A controller reviews the input adjustments in a valuation file. Which one is contrary to the standard?Single choiceL4
- A comparable asset is valued at …. The asset being measured is in a less favourable condition; market participants would apply a discount of … (case data), linked to that characteristic of the asset and not to the quantity held by the entity. What is the fair value of the asset being measured?CalculationL4Variant
- A comparable warehouse sold for …. The warehouse being measured is better located: market participants would pay a premium of … (case data) for this location, a characteristic of the asset. The entity holds a single unit, unrelated to the size of its position. Compute the fair value of the warehouse being measured.CalculationL4Variant
- Orvane holds a quoted interest whose size is several times the daily trading volume. To measure it, its valuer proposes two adjustments to the quoted price: (1) an 8% discount to reflect the size of the position; (2) a 4% discount because the asset being measured is less well located than the comparable used. Write a reasoned analysis of each adjustment.JudgmentL4
Bid and ask prices3 questions
- An instrument traded on a dealer market shows a bid price of 51.80 and an ask price of 52.40. Which price does the standard use for fair value?Single choiceL3
- A share is quoted by dealers with an ask price of … and a bid price of …. Compute the bid-ask spread per share, then the mid-market price the entity would use if it applies that market convention (permitted by the standard, not required).CalculationL3
- A valuer comments on their treatment of a quoted instrument with a bid price and an ask price. Which of their statements is wrong?Single choiceL3
Classifying by the lowest-level input3 questions
- A fair value measurement rests on several inputs falling in different levels of the hierarchy. How is the measurement classified?Single choiceL3
- An instrument is measured from a Level 2 price, which represents most of its value, and a Level 3 volatility that the valuer judges significant to the measurement (case judgement). Which of these analyses of the classification is wrong?Single choiceL3
- Tolven measures an instrument with a model using a Level 2 yield curve and an unobservable liquidity adjustment equal to 0.2% of the value. After analysing the factors specific to the instrument, it judges (case judgement) this adjustment not significant to the measurement as a whole. In which level does it classify the measurement?Single choiceL3
Level 14 questions
- An unadjusted quoted price, in an active market, for an identical asset to which the entity has access at the measurement date is a Level 1 input.True / falseL1
- Which of these inputs is a Level 1 input for the measurement of a share in Verdane, which the entity holds?Single choiceL1Variant
- A fund holds bonds issued by Castelle, traded daily in an active market accessible to the fund. Which of these inputs is Level 1 for measuring those bonds?Single choiceL2Variant
- An analyst classifies in Level 1 the measurement of a Prelane bond, on the grounds that it uses the quoted price, in an active market, of another Prelane bond from the same issuer but with a different maturity. What is the error?Single choiceL2
No blockage factor2 questions
- Tarvel holds 500,000 shares of a company listed in an active market, whereas the average daily trading volume is 40,000 shares. A controller examines four proposed treatments. Which one is wrong?Single choiceL4
- A company holds 120,000 shares of an issuer listed in an active market. The closing price is 18.50 per share and the average daily trading volume is 15,000 shares. What is the fair value of the position?Single choiceL4
Level 21 question
Level 34 questions
- An entity has to develop an unobservable Level 3 input to measure an instrument. How does it proceed?Single choiceL3
- For an unlisted debt, Wendrel sets the risk premium of its discount rate from its own internal data only, without consulting the reasonably available market information, which indicates that market participants would require a different premium. What is the error?Single choiceL3
- Dravane measures an unlisted convertible debt. Its model uses a risk premium estimated internally at 4%. Reasonably available market information (comparable debts recently issued) suggests that market participants would rather require 5.5%. The team hesitates between keeping 4%, using 5.5%, or launching an exhaustive study of all investors. Write a reasoned analysis of the approach to follow for the Level 3 input.JudgmentL3
- For units in an unquoted fund, with no observable transaction, Ivrelle writes in its note: « Lacking an active market, our objective is no longer an exit price: we use the value the units have for us, without a risk premium, as we do not intend to sell them. » What is the error?Single choiceL3
Transfers between levels2 questions
Non-orderly transactions2 questions
- An entity notes that a recent transaction in an instrument was concluded at a price well below that of the other transactions. How does it treat this information in its measurement?Single choiceL4
- A valuer justifies their treatment of prices in a market where activity has decreased. Which of their statements is wrong?Single choiceL4
Disclosure objectives2 questions
Fair value by category and level4 questions
- How does the entity present, in its notes, the fair values of its assets and liabilities measured at fair value?Single choiceL2
- Which of the following items of information does the entity provide by class of assets and liabilities for its fair value measurements?Multiple choiceL2
- A group's fair value table shows on a single line 'Financial instruments' both Level 1 and Level 3 instruments, without distinguishing the levels. What is the error?Single choiceL2
- On what criteria does the entity determine the classes of assets and liabilities for the fair value disclosures?Single choiceL2
Techniques and inputs (Levels 2 and 3)4 questions
- For a recurring measurement classified in Level 2 or Level 3, what must the entity describe in its notes about the measurement method?Single choiceL3
- Which statements about the disclosures on valuation techniques and inputs are consistent with the standard?Multiple choiceL3
- A group's fair value table shows an interest rate swap classified in Level 2, with its fair value, but the notes describe neither the technique nor the inputs used. What is the error?Single choiceL3
- A fund holds: (1) a share quoted in an active market, measured at its price; (2) a Level 2 interest rate swap; (3) an unlisted Level 3 interest. For which of these items does the entity describe the valuation techniques and the inputs used?Single choiceL3
Level 3 reconciliation5 questions
- Valdoren's Level 3 instruments, measured on a recurring basis (case data), have an opening balance of …. During the year: gains recognised in profit or loss …, gains in other comprehensive income …, purchases …, sales … and transfers into Level 3 …. Compute the closing balance of the reconciliation.CalculationL3Variant
- For the Level 3 class 'unlisted securities' (recurring measurements, case data), the balance at the start of the year is …. Movements for the year: loss in profit or loss …, gain in other comprehensive income …, acquisitions …, settlements … and transfers out of Level 3 …. What closing balance must the reconciliation show?CalculationL3Variant
- The Level 3 reconciliation of a class (recurring measurements, case data) starts from an opening balance of …. Movements for the year: gain in profit or loss …, purchases … and sales …. The published closing balance is …. Compute the unexplained difference (calculated closing balance less published closing balance).CalculationL3
- For a Level 3 class measured on a recurring basis (case data), a group publishes a reconciliation that moves from an opening balance of 800 to a closing balance of 950, detailing only profit or loss (+ 60). The year's purchases (+ 120) and sales (− 30) do not appear. What is the error?Single choiceL3
- Which statements about the reconciliation of recurring Level 3 measurements are consistent with the standard?Multiple choiceL3
Level 3 process and sensitivity2 questions
- For recurring Level 3 measurements, what information about unobservable inputs does the entity provide in addition to the reconciliation of balances?Single choiceL4
- For its recurrently measured Level 3 assets, a group publishes the fair value, the technique and the reconciliation of balances, but nothing on the sensitivity of the measurement to unobservable inputs. What is the reviewer's conclusion?Single choiceL4
Items whose fair value is only disclosed2 questions
- A loan measured at amortised cost in Sorvane's accounts nevertheless has its fair value disclosed in the notes. What must the entity state about that fair value?Single choiceL3
- A group's notes give, for financial liabilities at amortised cost whose fair value is disclosed, only the fair value amount. What is the error?Single choiceL3
Inseparable credit enhancement1 question
Tabular format1 question
Effective date1 question
Prospective application1 question
IAS 16: revaluation3 questions
- A group has chosen the revaluation model of IAS 16 for its land. What is IFRS 13's part in measuring a revalued piece of land?Single choiceL3
- A piece of land is carried at …. At the revaluation date (IAS 16 revaluation model), its fair value determined under IFRS 13 is …. A decrease of … on the same land had been recognised in profit or loss at an earlier revaluation. What amount is recognised in other comprehensive income?CalculationL3
- A controller reads a group's note on the revaluation of its operating buildings. Which of these statements is wrong?Single choiceL3
IAS 38: active market2 questions
- An entity considers applying the revaluation model to a freely transferable fishing licence, an intangible asset. Which condition of IAS 38 must be met?Single choiceL3
- A group revalues an acquired brand relying on the price of a few sales of brands from other sectors, concluded rarely and case by case. What is the error?Single choiceL3
IAS 36: fair value less costs of disposal3 questions
- For an impairment test, the recoverable amount under IAS 36 is the higher of two amounts. Which one reflects the assumptions of market participants rather than factors specific to the entity?Single choiceL3
- For an impairment test, the fair value of a unit, determined under IFRS 13 in its principal market, is …. Costs of disposal not already recognised as liabilities (legal fees and transaction duties of the planned sale) amount to …. Compute fair value less costs of disposal.CalculationL3
- A group shows in its fair value table, in Level 3, the value in use of an asset tested for impairment. What is the error?Single choiceL3
IFRS 9: classification and day-one difference4 questions
- Cobriel enters into a gas purchase contract within the scope of IFRS 9 that does not meet the IAS 32 definitions of a financial asset or financial liability (case data). Which element is decisive in deciding whether this contract falls within the scope of the exception for measuring on a net basis?Single choiceL4
- An institution acquires an instrument that will pay it a single cash flow of … in …. The market rate observed for comparable cash flows is …. It pays …. Fair value is required at initial recognition (case data). Compute the difference between the fair value obtained by discounting and the transaction price.CalculationL4
- A group's methodology note describes IFRS 13's role for its financial instruments. Which sentence is wrong?Single choiceL4
- A bank acquires a loan for 960; the applicable standard requires fair value at initial recognition, which comes out at 1,000 by discounting based only on observable market data (case data). In that case, the applicable standard calls for no different treatment of the difference of 40 (case data). What treatment does it adopt?Single choiceL4