Valuation of Non Financial Instruments

As per the International Financial Reporting Standards (IFRS 13), the fair value has been defined as ‘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.’  This also applies to non-financial assets & liabilities.

While measuring the non-financial assets, the following principles must be kept in mind:

  • The asset or liability being measured, including its condition, location and any restrictions on the sale;
  • The principal (or most advantageous) market in which an orderly transaction would take place for the asset or liability;
  • For a non-financial asset, the highest and best use of the asset and whether the asset is used in combination with other assets or on a stand-alone basis’; and
  • The assumptions that market participants would use when pricing the asset or liability.

Our valuation experts not only understand the quantitative techniques required to value the assets but also understand the accounting principles, market practices, data limitations and best practices to provide you with a complete package to understand all the relevant factors which influence or impact the valuation.    We assist a number of corporates/entities in valuing their non-financial assets and businesses.  We have assisted organisation in the following areas:

A) Valuation and impairment assessment of Goodwill and similar intangible assets;

B) Valuation of internally developed intangible assets;

C) Valuation of Start ups/Software /IT enabled entities;

D) Impairment assessment of assets with infinitive useful life;

E) Valuation of non financial assets and liabilities;

F) Valuation support to banks and Venture capitalists for their investment in new entities;

G) Valuation of fixed assets including softwares; and

H) Variety of assets and liabilities including professional sports club/ franchise.

Feel free to contact our valuation Desk to discuss your requirements.