Course detail

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Contents

• Introduction
• Prerequisites
  
• Course Level
  
• Topics
  
• Course Benefits
  
• Teaching Method
  
• Continuing Professional Education
  
• Venue
  
  

Introduction

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The use of fair value accounting in both IFRS and US GAAP has become increasingly widespread in recent years. The definition and measurement of fair value, however, has not always been consistent. This two-day course explores the current approach to measuring fair values, including recent changes to US GAAP and prospective changes to IFRS included in outstanding exposure drafts.

The FASB issued FAS 157/ASC Topic 820 Fair Value Measurement (now included in the FASB Accounting Standards Codification), which was effective for years beginning after 15 November 2007. The standard set out a new definition of fair value, established a framework for measuring fair value (the fair value hierarchy) and expanded disclosures about fair value measurements. The new rules amended 28 existing US GAAP pronouncements and affected 67 pronouncements that referred to fair value.

The FASB also issued FAS 159/ASC Topic 825-10 The Fair Value Option for Financial Assets and Financial Liabilities (now included in the FASB Accounting Standards Codification), which allowed US GAAP users to recognize eligible assets and liabilities at fair values. The objective was to alleviate volatility in reported earnings without having to apply complex hedge accounting provisions. This approach is similar to a measurement choice called the 'fair value option' previously adopted by the IASB in 2005 as a revision to IAS 39 Financial Instruments: Recognition and Measurement.

In May 2009, the IASB issued an Exposure Draft: Fair Value Measurement. With 17 current pronouncements requiring the use of fair value measurements, the potential changes to IFRS are substantial.

In addition, both the IASB and FASB are considering a significant change in the fair value measurement guidance applied to provisions (estimated liabilities).

This course answers questions such as:

• What are the fair value measurement requirements under US GAAP and what is the latest status of the IASB Exposure Draft on Fair Value Measurement?

• How do the IFRS and US GAAP versions and application requirements of the 'fair value option' for financial instruments differ?

• When and how should the Fair Value Hierarchy be applied?

• How does fair value accounting affect the impairment testing of assets?

• What disclosures are required?

Prerequisites

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Understanding of basic accounting principles based on IFRS or US GAAP. No advance preparation is required for this course.

Course Level

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Intermediate

Topics

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• Fair Value Measurement
• New definition of fair value
• Fair value hierarchy
• Market participant assumptions
• Various risks affecting fair value measurements
• Measurement of assets and liabilities
• Valuation techniques (market-based and non-market based)
• Disclosures
• Transitional rules
• Impact of Fair Value Measurement Rules in Key Areas
• Business combinations and intangibles
• Nonmonetary transactions
• Long-lived assets held for sale
• Pensions and other postretirement benefits
• Financial instruments
• Asset retirement obligations
• Revenue
• Impairment testing
• Provisions and other liabilities
• Fair Value Option for Financial Instruments
• May 2009 IASB Exposure Draft on Fair Value Measurement
• January 2010 IASB Exposure Draft on Measurement of Liabilities in IAS 37

Course Benefits

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• Build on existing knowledge of FAS 157/ASC Topic 820 and 159/ASC Topic 825-10
• Evaluate the implications of IASB's exposure draft on measuring liabilities in IAS 37
• Apply the Fair Value Hierarchy
• Understand the impact of fair value measurements on existing pronouncements
• Differentiate between IFRS and US GAAP requirements relating to the fair value option for financial instruments
• Comply with financial instrument fair value option disclosure requirements
• Learn how fair value alternatives affect the impairment testing of assets
• Plan ahead for expected future changes in fair value measurement under IFRS

Teaching Method

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• Live group instruction
• Description and explanation of changes in the measurement of fair value under FAS 157/ASC Topic 820, including implementation requirements and transitional rules
• Discussion regarding the potential impact of FAS 157/ASC Topic 820 on IFRS
• Extensive use of examples and case studies illustrating the application of the fair value measurement rules and the Fair Value Option
• Interactive participation is encouraged

Continuing Professional Education (CPE)

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16 hours

Venue

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All of our Dubai seminars take place in 4 star professional conference facilities, usually in city-centre downtown hotels like the Marriott, Sheraton or Hilton brands.

Detailed Joining Instructions are sent to all registered delegates by email approximately one month before the event. The Joining Instructions will confirm exact venue details and nearby (or onsite) hotel recommendations with bedroom rates where available.

Coffee and lunch will be provided.