Valuation of unquoted investment as per ind as

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 January 2016 Hello
Can someone please prescribe the appropriate method for computation of value of unquoted Investment as per IND AS??

Guest

Guest (Expert)

23 January 2016 Please use discounted cash flow method - it is universally accepted method and also accepted for IND AS

Querist : Anonymous

Querist : Anonymous (Querist)

23 January 2016 Sir
Can you Please suggest me the specific IND AS no. to be referred for it??

Guest

Guest (Expert)

23 January 2016 Please understand that IND AS does not state the method of valuation of share - it only accepts fair valuation. Since you asked method of fair valuation of share, I have suggested discounted cash flow method.

Querist : Anonymous

Querist : Anonymous (Querist)

23 January 2016 Sir
As per my research IND AS 109 is applicable which suggests that it should be carried @ cost unless circumstances require to value it as per fair value
but i am not getting clarity on it

Guest

Guest (Expert)

23 January 2016 Under para 5.1.1, except for trade receivables, the FIs shall be measured only at fair value. I dont think it says it shall be valued at cost unless circumstance require it to value at fair value. Please correct me if i am wrong

Querist : Anonymous

Querist : Anonymous (Querist)

23 January 2016 Sir
The respective IND AS speaks that if the financial asset is subsequently not measured at FVTPL, transaction cost should be taken as base

Guest

Guest (Expert)

23 January 2016 Para 4.1.1 states that entity shall subsequently measure at either amortized cost or fair value thro oci or at fair value thro p&l. No where it states transaction cost can be taken as base. Please note that amortized cost is not transaction cost. It is method of valuation using compounded interest and projecting future cash in regular stream. So only option is fair value.

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