Document ID: chunk:federal_register_of_legislation:F2023L00010:body:0:p20
Version: federal_register_of_legislation:F2023L00010
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Character Range: 52937–55942

service concession asset. In developing AASB 1059 Service Concession Arrangements: Grantors, the Board noted that it did not provide guidance on the measurement of service concession assets on the grounds that this would best be developed in a future project on the measurement of public sector assets – the Fair Value Measurement for Not-for-Profit Public Sector Entities Project (FVM project).

Due process

Fair Value Project Advisory Panel
BC10            The Board established the Fair Value Project Advisory Panel (the Panel) to provide a forum for the Board to consult with on specific fair value measurement issues. The Panel consists of industry experts with experience in dealing with fair value measurement issues, and includes asset valuers and preparers and auditors of financial statements. The Board held numerous meetings with the Panel over the course of the project. The FVM project has been assisted considerably by extensive input from Panel members.
BC11            As part of the FVM project, the Board also consulted with some asset valuers and the Australian Property Institute to seek understanding of how asset valuations are carried out in practice, and whether (and, if so, in what manner) the principles in AASB 13 differ from these practices.

Stakeholder feedback on the IPSASB's Measurement project
BC12            In April 2021, the International Public Sector Accounting Standards Board (IPSASB) issued Exposure Draft ED 77 Measurement. If approved as a final pronouncement, ED 77 would establish a single comprehensive Standard that identifies and defines the measurement bases used in IPSAS for not-for-profit public sector entities.
BC13            ED 77 was developed based on the view that the fair value measurement basis under IFRS 13 (which is adopted in AASB 13) would be applicable to assets held for their financial capacity, but would be inappropriate for measuring the current value of assets held for their operational capacity (ie assets not held primarily for their ability to generate net cash inflows). Instead, the IPSASB proposed a different current value measurement basis – current operational value – for measuring the current value of assets held for their operational capacity.
BC14            In contrast with fair value, which is a market-participant-based exit value reflecting an asset's highest and best use, current operational value is proposed to be an entity-specific entry value based on an asset's current use. The IPSASB proposed that the same three measurement techniques – the market, income and cost approaches – would be applicable in estimating both:
(a)                    an asset's fair value, for assets held primarily for their financial capacity; and
(b)                   an asset's current operational value, for assets held primarily for their operational capacity.
BC15            In accordance with paragraph 20 of The AASB's Approach to International Public Sector Accounting Standards (October 2019), in May 2021 the