Document ID: chunk:federal_register_of_legislation:F2023L00010:body:0:p55
Version: federal_register_of_legislation:F2023L00010
Segment Type: other
Provision Reference: 
Character Range: 147499–150564

some stakeholders commented that infrastructure (eg roads, drainage and sewerage works), parliament houses, fire stations, police stations, war memorials, traffic or pedestrian facilities, and community facilities (eg toilet blocks) are typical assets for which information about other market participant assumptions often would neither be reasonably available nor indicate that those assumptions differ from the entity's own assumptions. However, the Board concluded it will depend on the facts and circumstances of each non-financial asset whether it exhibits neither of these characteristics.
BC133        The Board also considered a request from ED 320 respondents for clarification of whether the proposed requirement to measure an asset's fair value using the entity's own assumptions as a starting point would apply on a whole-of-asset basis or on a per-input basis to a fair value estimate. The Board decided to clarify in paragraph F7 that, when some inputs to a fair value estimate are observable market data and other inputs are unobservable, the unobservable inputs would be used for part of the asset's fair value estimate. Paragraph F7 provides an example of a self-constructed specialised facility, the land component of which has comparable land with an observable market price. If entity-specific data are needed to measure the fair value of some or all of the improvements on that land, those entity-specific data would be included in the fair value estimate for the facility together with observable data about market participant assumptions for other components of the facility.

Specialised asset considerations
BC134        Since most stakeholders' requests for guidance on fair value measurement pertain to non-financial assets that either have limited market inputs, or are specialised, or both, the Board considered whether to provide guidance on identifying the market participant assumptions to use when measuring specialised assets only, rather than providing guidance more broadly on all non-financial assets not held primarily for their ability to generate net cash inflows.
BC135        The Board decided not to provide guidance limited to specialised assets because:
(a)                    the application of AASB 13 should not be based on the nature of the asset, in view of AASB 13 providing a fair value hierarchy focused on the nature and extent of observable inputs; and
(b)                   it would be difficult to clearly distinguish specialised assets from other assets.

Other considerations
BC136        The Board considered, but rejected, providing guidance on market participant assumptions based on whether a market participant other than the holder of the asset subject to measurement (the subject asset) is readily identifiable, and on identifying the entity likely to be the highest bidder for the subject asset in a hypothetical sale.
BC137        The Board made this decision after considering comments received from stakeholders in targeted outreach that many non-financial assets of not-for-profit public sector