This week, the Standards Board of the International Valuation Standards Council (IVSC) published a new discussion paper titled “The Valuation of Liabilities.”
Based on a framework that excludes liabilities arising from financial instruments, the new paper proposes a working definition of liability (“an obligation which could result in an outflow of resources”) as well as related guidance and practices. “The board is seeking views on the types of liability that should be included in any future IVSC pronouncements, within the proposed framework of excluding liabilities arising under a financial instrument or other form of contract in this instance,” says this month’s IVSC E-News. The board also wants to hear “about the methods currently being used to value different types of liabilities and any difficulties encountered in practice.” Comments are due April 30, 2013.
New, improved standards. The IVSC has also just issued an exposure draft of Amendments to the International Valuation Standards. The proposed changes include clarifying:
- The applicability of the standards to valuation reviews;
- Matters to be considered before relying on information provided by others; and
- The need to identify the “unit of valuation.”