IASB Exposure Draft on Measurement Uncertainty Analysis Disclosure for Fair Value Measurements
On 29 June 2010 the IASB published for public comment further enhancements to a disclosure proposal on Level 3 fair value measurements that formed part of the IASB’s exposure draft Fair Value Measurement published in May 2009.
ED/2009/5 proposed a fair value hierarchy for the categorisation of fair value measurements of assets, liabilities and an entity’s own equity instruments. The IASB and the FASB have tentatively decided to require entities to disclose a measurement uncertainty analysis for fair value measurements categorised within Level 3 of the fair value hierarchy unless another IFRS specifies that such a disclosure is not required for a particular asset or liability. When disclosing a measurement uncertainty analysis, an entity must take into account the effect of correlation between unobservable inputs, when relevant.
The requirement to take into account the correlation, if any, between unobservable inputs was not included in the disclosure proposals in ED/2009/5. This document addresses the proposed requirement for an entity to disclose a measurement uncertainty analysis for fair value measurements categorised within Level 3 of the fair value hierarchy given the boards’ decision to require an entity to take into account the effect of correlation between unobservable inputs in that analysis.
IASB's deadline for comment is 7 September 2010.
To download the Exposure Draft, click here.
We welcome participations from interested parties to review this document and to take this opportunity to express our views to IASB.
We would like to hear from you about this important document via return email or in writing to us before 6 August 2010. This is to allow us to submit your comments for the working group and Board's deliberations.
Click here to Comment Online.