Document ID: chunk:federal_register_of_legislation:F2023L00010:body:0:p54
Version: federal_register_of_legislation:F2023L00010
Segment Type: other
Provision Reference: 
Character Range: 144781–147815

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 on the hypothetical assumption that such market participants would acquire the not-for-profit public sector reporting entity's assets; it is not necessary that such an acquisition will actually occur. Where other not-for-profit public sector entities have comparable assets, information reasonably available to valuers about those assets enables valuers to assess whether other market participants would use different data from the entity's own data.
BC129        Adding paragraphs F5–F7 to AASB 13 is justified in accordance with paragraphs 24(a)(iii) and 30(h) of the AASB Not-for-Profit Entity Standard-Setting Framework, to reduce the potential for confusion regarding when the search for assumptions of other market participants ends, and in turn reduce the cost and effort required to identify which market participant assumptions to use in measuring the fair value of non-financial assets of not-for-profit public sector entities not held primarily for their ability to generate net cash inflows. This is because, unlike paragraph 89 of AASB 13, paragraphs F5 and F6 state that:
(a)                    if some data of other market participants to measure the fair value of an asset are not observable, the entity uses its own assumptions as a starting point and adjusts them to the extent that reasonably available information indicates that other market participants would use different data; and
(b)                   to the extent that relevant information about the assumptions of other market participants is not reasonably available, the entity would use its own data to estimate the fair value of the asset without the need to incur exhaustive efforts to identify other market participant data.
BC130        In addition, paragraphs F5–F7 should be clearer and more straight forward to apply than paragraph 89 of AASB 13 alone, by treating the reasonable availability of other market participant data as a criterion for amending the entity's own assumptions, thus stipulating a process with two distinct steps. Paragraph 89 of AASB 13 refers to an entity needing to take into account all information about market participant assumptions that is reasonably available, without indicating the sequence in which that information would be taken into account if an entity uses its own data as part of estimating an asset's fair value.
BC131        The Board noted that respondents to ED 320 generally supported the Board's proposed guidance, and decided to confirm that guidance with some editing for greater clarity.
BC132        The Board observed that 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