Ind AS 113: Fair Value of Own Equity & Level 3 Inputs | Fair Value Measurement Explained

📘 IND AS 113 | Fair Value of Own Equity & Level 3 Inputs Do we really need to determine the fair value of our own equity shares? 🤔 Usually, the fair value of an entity’s own equity is not measured routinely. But in situations like a Business Combination under Ind AS 103, where shares are issued as purchase consideration, determining their fair value becomes important. So, how do we determine it? 🔹 Listed & actively traded → Quoted market price 🔹 Unlisted but comparable market data available → Valuation using comparable instruments/assets 🔹 No observable market data → Valuation techniques such as DCF using assumptions → Level 3 Inputs The key takeaway: Market price → Level 1 Comparable market information → Level 2 Significant unobservable assumptions → Level 3 And remember, Level 3 does not mean incorrect valuation. It simply means that significant inputs used in the valuation are not directly observable in the market. 💡 The lesser the observable market information, the greater the role of assumptions and professional judgement. Save this post for your Ind AS 113 revision and share it with someone preparing for CA exams! 📚 #IndAS113 #FairValue #IndAS #Accounting #CAInter #CAFinal #CharteredAccountant #FinancialReporting #BusinessCombination #IndAS103 #Level3Inputs #FairValueMeasurement #AccountingStandards #CAStudents #FinanceEducation