Our Business Risk Services team deliver practical and pragmatic solutions that support clients in growing and protecting the inherent value of their businesses.
We offer a dedicated team of experienced individuals with a focus on successfully executing transactions for corporates and financial institutions. We offer an…
We have a different way of doing business by delivering real insight through a combination of technical rigour, commercial experience and intuitive judgment. We take…
The Grant Thornton People & Change Consulting practice works with clients on these issues as well as on all aspects of how they attract, retain, engage develop, deploy and…
We work with a wide variety of clients and stakeholders such as high street banks, private equity funds, directors, government agencies and creditors to implement…
Motivating and assisting our clients to pursue, maintain and secure the benefits of digital solutions is at the core of our Digital Transformation teams' agenda and goals. We…
The Spring Statement from Chancellor Rachel Reeves was squarely aimed at retaining economic credibility in the face of worsening global economic conditions.
Our audit services can strengthen your business and stakeholders' confidence. You'll receive professionally verified results and insights that help you grow.
On 27 March 2024, the Financial Reporting Council issued amendments to FRS 100 – 105 (known as GAAP, or Generally Accepted Accounting Practice), a suite of accounting standards applicable in the UK and Ireland. These are used by an estimated 3.4 million businesses in preparing their financial statements.
Companies House is introducing mandatory identity verification requirements for Directors and People with Significant Control (PSCs), as the next step towards full implementation of the Economic Crime and Corporate Transparency Act 2023.
On 27 March 2024, the Financial Reporting Council issued amendments to FRS 100 – 105 (known as GAAP, or Generally Accepted Accounting Practice), a suite of accounting standards applicable in the UK and Ireland. These are used by an estimated 3.4 million businesses in preparing their financial statements.
On 10 December 2025 the UK Government laid The Companies (Accounts and Reports) (Amendment and Transitional Provision) Regulations 2024, which will take effect on 6 April 2025.
Northern Ireland businesses face further challenges as they operate in the only part of the UK that has a land border with a country offering a lower tax rate.
Our team specialises in remuneration and incentive planning and works closely with employers, shareholders and employees to ensure that business strategies are…
Our team of experienced advisors are on hand to guide you through any decision or transaction ranging from the establishment of new business ventures, to realising…
Grant Thornton Ireland offer a different approach to managing global mobility. We have brought together specialists from our tax, global payroll, people and…
Our outsourced service provides valued service to over 150 separate PAYE schemes. These ranging from 1 to 1000 employees, working for micro, SME and global…
Our Tax Disputes and Investigation team is made up of tax experts and former HMRC investigators who have years of experience in dealing with a variety of tax…
At Grant Thornton (NI) LLP, our team helps Northern Ireland businesses manage their UK and global indirect tax risks which, as transactional taxes, can quickly…
There is no silver bullet for Northern Ireland businesses in how they can navigate the challenges posed by President Trump’s tariffs, but it is crucial that they are agile, strategic, and proactive in managing risk within an increasingly uncertain trade environment
Grant Thornton Ireland is rapidly approaching 3,000 people, in 9 offices across Ireland, Isle of Man, Gibraltar and Bermuda. With a presence in over 149...
Business combinations are infrequent transactions that are unique for each occurrence. IFRS 3 ‘Business Combinations’ contains the requirements and despite being fairly stable in the ten years since it's been released, still provides challenges when accounting for these transactions in practice.
Our ‘Insights into IFRS 3’ series summarises the key areas of the Standard, highlighting aspects that are more difficult to interpret and revisiting the some relevant features that could impact your business.
This article sets out the definition and underlying principles of fair value, gives a brief overview of permissible valuation techniques and presents IFRS 3’s specific guidance on fair value measurement.
IFRS 3’s measurement principle
The identifiable assets acquired and liabilities assumed in a business combination are measured in accordance with the general measurement principle in IFRS 3 which states they should be measured at their acquisition-date fair values.
Definition
close
Fair value
The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
However, there are a few exceptions to this measurement principle, which are discussed in our article ‘Insights into IFRS 3 – Specific recognition and measurement provisions’. If an identifiable asset or liability has a quoted price in an active market (for example, listed shares), this price should be used as fair value. However, few assets and even fewer liabilities have such quoted prices. So in many cases, fair value then needs to be estimated using a valuation technique. As a result estimating fair values can be a complex exercise requiring considerable management judgement and many acquirers engage professional valuation specialists to assist in this stage of the process.
A number of concepts are embodied in this definition. Firstly, it clarifies fair value is an ‘exit’ price – for example it refers to the transfer of a liability rather than settlement. Secondly, it assumes an orderly sale or transfer (ie not a forced transaction or a distressed sale). Thirdly, there is an explicit reference to ‘market participants’, emphasising fair value is a market-based concept and not an entity specific value. Finally, IFRS 13 clarifies fair value is a current price at the measurement date (eg the acquisition date in a business combination).
Subscribe to our mailing list
Update your subscriptions for Grant Thornton publications and events.
Our ‘Insights into IFRS 3’ series summarises the key areas of the Standard, highlighting aspects that are more difficult to interpret and revisiting the most relevant features that could impact your business. IFRS 3 has specific guidance on how some items are recognised and measured. This article summarises this specific guidance and provides examples to illustrate its application.
Our ‘Insights into IFRS 3’ series summarises the key areas of the Standard, highlighting aspects that are more difficult to interpret and revisiting the most relevant features that could impact your business. This article explains the recognition principles set out in IFRS 3.
