Page 26 - PowerPoint Presentation

IFRS 13

Elements Of Fair Value Measurement

Disclosure – Example

Serviplex Limited ('Serviplex’) is a 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.