AASB Conceptual Framework for Financial Reporting (May 2019)
Chapter 6: Measurement – AASB Conceptual Framework for Financial Reporting (May 2019)

AASB Conceptual Framework for Financial Reporting (May 2019) 6.87: Measurement of equity and cash-flow-based measurement techniques

What does 6.87 require?

Total equity is never measured on its own: it is simply recognised assets minus recognised liabilities, and it will not normally match the market value of the equity claims or what a sale or liquidation of the entity would fetch. Individual classes and components of equity may be measured directly or by allocation. Cash-flow-based measurement techniques are not measurement bases but means of estimating a measure on a chosen basis; they capture the estimate of future cash flows, possible variations in their amount or timing from uncertainty, the time value of money, the price for bearing that uncertainty and other factors such as liquidity, in a way that avoids double counting and reflects the objective of the chosen basis.

Maintained by Gerard Blokdyk

Other controls in Chapter 6: Measurement – AASB Conceptual Framework for Financial Reporting (May 2019)

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