The evolution of fair value measurement

Fontes, Joana and Panaretou, Argyro and Shakespeare, Catherine (2024) The evolution of fair value measurement. Accounting and Business Research, 54 (7). pp. 760-774. ISSN 0001-4788

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Abstract

While measurement is a fundamental process to the preparation of financial statements, the conceptual frameworks established by both the International Accounting Standards Board (IASB) and the Financial Accounting Standards Board (FASB) offer limited guidance on selecting an appropriate measurement basis for assets and liabilities. This paper examines the historical progression of fair value measurement, a measurement basis that is at the centre of some of the most polarising views. We believe that understanding the evolution of fair value measurement is pivotal for aiding academics and practitioners in shaping the future trajectory of measurement. This is particularly crucial given the technological advances in corporate reporting and the need to enhance the connectivity between financial and non-financial reporting.