Fair value accounting: Is it an appropriate measure of value for today’s financial instruments?

May 2008
  • Print-friendly version
Point of view: Fair value accounting: Is it an appropriate measure of value for today’s financial instruments?

At a glance

PwC explains the benefits and challenges of fair value accounting for measuring the value of financial instruments.

Highlights:

  • The impact of fair value measurements—whether positive or negative on a company—is the result of market forces.
  • Fair value of financial instruments, despite concerns, is the best available method to reflect market conditions.
  • Current conditions call into question whether we are ready for fair value accounting for certain non-financial items.
  • Investors benefit when companies disclose their views on the impact of market illiquidity in their financial reporting.