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IFRS 13

Elements of fair value measurement

Disclosure – Example

Serviplex Limited ('Serviplex’) is a retail company listed on the JSE Limited. The chief

financial officer recently contacted the audit firm at which you are a technical manager,

requesting the firm to assist him with the measurement and disclosure of several assets in

accordance with IFRS 13 Fair Value Measurement. Serviplex has a 31 December year end

and the following details regarding the assets and liabilities that are measured at fair value

in respect of the year ended 31 December 20.13 are made available:

Investment properties

• Serviplex holds an office building that is leased out to third parties and carried under the

fair value model in IAS 40. In its current use the present value of the net future cash
flows was calculated at R8 550 000 on 31 December 20.13. On 31 December 20.13 this

office building could be sold in the open market for R9 150 000 before transaction cost

of 5%. The open market value was determined with reference to a limited number of

similar buildings, situated in the same location, that are currently in the market.

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