Document ID: chunk:federal_register_of_legislation:F2024C00046:body:0:p103
Version: federal_register_of_legislation:F2024C00046
Segment Type: other
Provision Reference: 
Character Range: 271532–274564

for their ability to generate net cash inflows are unique to the holder of the asset and another identifiable market participant for the asset would be unlikely to exist (ie the entity would be unlikely to find observable inputs for measuring the fair value of such unique assets), the Board considered that the holder of those assets would need to develop at least some unobservable inputs in order to measure the fair value of those assets.
BC126        In relation to developing unobservable inputs, paragraph 89 of AASB 13 states that:
          An entity shall develop unobservable inputs using the best information available in the circumstances, which might include the entity's own data. In developing unobservable inputs, an entity may begin with its own data, but it shall adjust those data if reasonably available information indicates that other market participants would use different data or there is something particular to the entity that is not available to other market participants (eg an entity-specific synergy). An entity need not undertake exhaustive efforts to obtain information about market participant assumptions. However, an entity shall take into account all information about market participant assumptions that is reasonably available. Unobservable inputs developed in the manner described above are considered market participant assumptions and meet the objective of a fair value measurement. [emphasis added]
BC127        Paragraph 89 of AASB 13 permits the use of an entity's own data in developing unobservable inputs. In relation to applying the principle noted in paragraph BC122, the Board decided to add implementation guidance clarifying paragraph 89 of AASB 13 by:
(a)                    re-expressing the requirements of that paragraph, so that an entity's own assumptions are required to be used at a starting point if some relevant information about other market participant assumptions needed to estimate the fair value of the asset is not reasonably available;
(b)                   retaining the requirement for a not-for-profit public sector entity to adjust its own data if reasonably available information indicates that other market participants would use different data or there is something particular to the entity that is not available to other market participants (eg an entity-specific synergy). This would preclude an entity from using its own unadjusted data where those data are inconsistent with reasonably available information about the inputs that other market participants (eg other not-for-profit public sector entities, such as other local governments) would use in pricing the asset; and
(c)                    replicating the statement in paragraph 89 of AASB 13 that an entity need not undertake exhaustive efforts to obtain information about other market participant assumptions.
BC128        In relation to paragraph BC127(b), the use of data about the inputs that other not-for-profit public sector market participants would use in pricing the asset is based