What information does fair value provide when an entity is using an asset or fulfilling a liability different from how market participants would?
If an entity is not using an asset according to its highest and best use or if an entity is not fulfilling a liability in a way other than by transferring it to a third party, fair value provides a market benchmark to use as a basis for assessing the entity’s advantages or disadvantages in performance or settlement relative to the market. Therefore, when an asset or liability is measured at fair value, the relative efficiency of the entity in using the asset or settling the liability appears in the course of business, and not before.
- How does an entity measure the fair value of a tangible asset (such as property, plant and equipment) that does not have an observable market price or directly identifiable cash flows?
- When I received my "Change of Assessment" notice, it had the Fair Market Value, the Taxable Value, and the Gross Assessed Value. What do these different values mean?
- Why is the City’s assessed value different from a private appraiser’s estimate of fair market value I obtained recently?
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