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| Definition: |
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The fair value of a financial asset or liability refers to the value that approximates the value that would arise from a market transaction between unrelated parties.
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| Context: |
Fair values can be used in most situations in which market-price data are unavailable. Two general methods for establishing fair values involve use of either:
· Market prices of financial assets and liabilities that are market traded but otherwise similar to the non-traded financial assets and liabilities that are being fair valued; or
· Discounted present values of future cash flows from nontraded financial assets and liabilities.
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| Source
Publication: |
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Monetary and Financial Statistics Manual, IMF, Washington, 2000, paras. 219-220.
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| Statistical
Theme: Financial statistics |
| Created
on Tuesday, September 25, 2001 |
| Last
updated on Monday, January 20, 2003 |
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