Document ID: chunk:federal_register_of_legislation:F2024C00046:body:0:p140
Version: federal_register_of_legislation:F2024C00046
Segment Type: other
Provision Reference: 
Character Range: 371926–374857

of Local Government in a jurisdiction desires greater consistency in the valuation approach(es) used to measure the fair value of particular types or classes of non-financial assets in a jurisdiction, it may choose to designate a valuation approach for application to those assets held by public sector entities in its jurisdiction.

Stakeholder feedback on ED 320
BC256        A majority of respondents who commented on this topic agreed with the Board's decision not to mandate the measurement technique to apply for measuring the fair value of specific assets, including land subject to public-sector-specific legal restrictions. However, a few respondents requested the Board to mandate the use of the cost approach in measuring the fair value, or the use of an entity-specific entry price to measure the current value, of all non-financial assets of not-for-profit public sector entities not primarily held for their ability to generate net cash inflows. The Board observed that the feedback received on ED 320 did not identify any supporting or opposing arguments that had not yet been considered by the Board in deciding that fair value should remain the sole current value measurement for non-financial assets and not to mandate the measurement technique to apply for measuring the fair value of specific assets, including restricted land.
BC257        In addition, a few other respondents asked the Board to elevate paragraph IE29 of the IASB's Illustrative Examples accompanying IFRS 13 (quoted in paragraph BC103) to authoritative guidance. That IASB illustrative example included a comment indicating that restrictions would be taken into account only if they transfer to the market participant buyer, and those respondents envisage that elevating the specific comment to authoritative guidance would effectively preclude the deduction of discounts for restricted land.
BC258        The Board observed that the IASB decided to include that example in supplementary supporting material rather than as part of IFRS 13. The IASB stated that its Illustrative Examples illustrate aspects of IFRS 13 but are not intended to provide interpretative guidance. Accordingly, adding such an example in the Board's implementation guidance (which will be an integral part of AASB 13) would, inappropriately, elevate the status of the IASB example above that accorded to it by the IASB. In addition, it would create a risk that readers interpret the example as a rule of thumb. This is because:
(a)                    the IASB's conclusion in the above-mentioned paragraph IE29 of its Illustrative Examples that "the donor restriction on the use of the land" would not be taken into account in the fair value measurement of the land is drawn only after "Upon review of relevant documentation (eg legal and other), the association determines that the fiduciary responsibility to meet the donor's restriction would not be transferred to