What inventories are valued at fair value?

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Lasa1
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Joined: 07 Oct 2020, 11:29

What inventories are valued at fair value?

Post by Lasa1 »

Hello,

I will start saying that this is a very academic question because I am preparing a Finance certification.
Question is : Which are the inventories that can be valued at fair value ? I found that IAS 41 allows agricultural production to be valued at fair value but are they the only ones?

Thanks
Regards
Cecilia
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Marek Muc
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Re: What inventories are valued at fair value?

Post by Marek Muc »

Hi, in addition, IAS 2 allows commodity broker‑traders to measure their inventories at fair value less costs to sell.

IAS 2.5:
Broker‑traders are those who buy or sell commodities for others or on their own account. The inventories referred to in paragraph 3(b) are principally acquired with the purpose of selling in the near future and generating a profit from fluctuations in price or broker‑traders’ margin. When these inventories are measured at fair value less costs to sell, they are excluded from only the measurement requirements of this Standard.
and that should be it

can you tell us more about the finance certification that you are preparing?
Lasa1
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Joined: 07 Oct 2020, 11:29

Re: What inventories are valued at fair value?

Post by Lasa1 »

That was quick! Thanks a lot.

I am preparing the Chartered Global Management Accountant professional certification to develop my accounting and financial analysis skills
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Marek Muc
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Re: What inventories are valued at fair value?

Post by Marek Muc »

ok, so you're preparing *for* the certification, I thought that you are creating one ;)

so good luck and feel free to come back with interesting accounting questions :)
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JRSB
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Re: What inventories are valued at fair value?

Post by JRSB »

Inventories acquired in a business combination?
"I am always ready to learn although I do not always like being taught" - Churchill
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Marek Muc
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Re: What inventories are valued at fair value?

Post by Marek Muc »

right!

Lasa, as JRSB pointed out, assets acquired in business combination, including inventories, are measured at fair value, you can read more here:

https://ifrscommunity.com/knowledge-bas ... iabilities
Lasa1
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Joined: 07 Oct 2020, 11:29

Re: What inventories are valued at fair value?

Post by Lasa1 »

Thanks!
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