Financial executives have the responsibility to present financial information accurately and fairly for their shareholders, creditors, and other interested parties.
When are valuations necessary for financial reporting?
Fair value measurements are required by Ind AS in a variety of circumstances, such as:
- To support testing of assets, such as goodwill, for impairment as per Ind AS 36
- To support fair value measurement of financial instruments that are not actively traded in an organized market as per Ind AS 109
- To support disclosure and compensation expenses related to equity-based compensation plans, including stock options as per Ind AS 102
- To support the allocation of the purchase price where a business is acquired as per Ind AS 103 and Ind AS 38