Fair Value: Auditing for Accuracy and Trust
Precision-driven valuation auditing that transforms complex financial measurements into transparent, credible stakeholder intelligence.
The Core Mandate
Fair value is defined as the exit price in an orderly transaction between market participants — a standard essential for transparency, comparability, and reflecting true economic position.
IFRS 13
International fair value measurement standard
PSA 545
Philippine standard on auditing fair values
ASC 820
US GAAP fair value measurement guidance
The Fair Value Hierarchy
1
2
3
1
Level 1 — Quoted Market Prices
Direct prices in active markets for identical assets or liabilities. Highest reliability.
2
Level 2 — Observable Inputs
Prices for similar items, adjusted using corroborated market data and benchmarks.
3
Level 3 — Unobservable Inputs
Discounted cash flows and risk margins where market data is limited. Greatest judgement required.
Strategic Audit Procedures
Framework Compliance
Obtain evidence that reporting fully complies with the entity's applicable financial framework.
Valuation Testing
Test market, cost, and income valuation approaches for methodological soundness and consistency.
Assumption Scrutiny
Evaluate management's assumptions, risk margins, and any reliance on independent valuation experts.
Representation Verification
Verify management representations for internal consistency, accuracy, and completeness of disclosure.
Delivering Integrity
Trust through precision.
Robust fair value auditing transforms complex measurements into clear, actionable insights for every stakeholder.
Mitigate Reporting Risk
Rigorous valuation scrutiny reduces the likelihood of material misstatement and regulatory exposure.
Build Organisational Credibility
Accurate, well-evidenced fair value disclosures strengthen investor confidence and market standing.