Fair Value Measurements & Disclosures

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Fair Value Measurements & Disclosures

IFRS 7 and Topic 820 (FAS 157)

An overview of the financial accounting standards for fair value measurements and disclosures are outlined below for companies that follow International or U.S. accounting standards. For a more complete and detailed description of each standard, it is recommended to visit the respective issuer’s website.

IFRS 7 Topic 820
(FAS 157)
Title Financial Instruments Fair Value Measurements and Disclosures
Issuer International Accounting Standards Board (IASB) Financial Accounting Standards Board (FASB)
Region International USA
Effective January 7, 2007 November 1, 2007
Overview IFRS 7 provides a hierarchy to be used in determining the fair value for a financial instrument. Some of the changes to Fair Value Measurements in IFRS 7 standard include new guidelines surrounding impairment assessment and strategic equity investment.

Topic 820 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures. Topic 820 emphasizes that fair value is a market-based measurement, establishing a fair value hierarchy for measurement:

Level 1: Quoted market prices in active markets.

Level 2: Prices other than quoted prices (valuation technique with observable market data).

Level 3: Unobservable inputs using estimates and assumptions.

How FINCAD can help

With its industry standard analytics and integrated market data, FINCAD solutions can provide the fair value measurements of derivatives classified as Level 2 or 3 under IFRS 7 and Topic 820.

Applicable FINCAD solutions:

Request a free demo of one of the above solutions.

We hope that this information will assist you, but it should not be used or relied upon as a substitute for your own independent research. For a more comprehensive view of the standards/requirements, please visit the respective issuer's website.

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