fair value
True market worth
Fair value is the price at which an asset would change hands between a willing buyer and seller, neither under pressure to complete the transaction.
The term dominates accounting and finance: The company marked its holdings to fair value.
Fair value attempts to reflect what something is actually worth in current market conditions, as opposed to historical cost or book value.
- mark-to-marketValuing at current price
- discounted cash flowTime-adjusted revenue valuation
- assessmentFormal evaluation of worth
- arm's lengthDeliberate professional distance
- impairmentDiminished function or capacity
intangible assets · equity · financial reporting · price · appraisal · estimate · acquisition · going concern · derivative · liquidation · accounting · auditor · worth · reasonable · market price · hedge · goodwill · GAAP
- Market Efficiencyrandom walk, arbitrage, public information, alpha
- financebank, CFO, banks, controller, finance
- financial termswealth, asset, currency, balance sheet, audit
- accountingbookkeeping, ledger, balance sheet, general ledger, accounts payable
- accounting termsassets, cash, expenses, equity, retained earnings
- investingstocks, stock, bonds, investing, investor
fair valuemispricing
Incorrect cost assignment
cooked books · book value · nominal value · cost basis · face value
fair valueovervaluation
Appraising too highly
undervaluation · overpriced · underpriced · premium · discount
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