Appendix B — Comparison of U.S. GAAP and IFRS Standards | DART

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Appendix B — Comparison of U.S. GAAP and IFRS Accounting Standards

ASC 820 is the primary source of guidance on how to measure fair value under U.S. GAAP. IFRS 13 is the primary source of guidance on how to measure fair value under IFRS Accounting Standards. IFRS 13 was the result of a joint project between the FASB and the IASB to develop common requirements for measuring fair value and disclosing information about fair value measurements.

The fair value measurement and disclosure requirements under U.S. GAAP are largely converged with, but are not identical to, those under IFRS Accounting Standards. For example, the two sets of standards differ with respect to when an entity is required or permitted to measure items at fair value and the extent of the disclosures an entity must provide. The table below summarizes some of the key differences between IFRS Accounting Standards and U.S. GAAP regarding fair value measurement.1

Table B-1

Subject	U.S. GAAP	IFRS Accounting Standards
Inception gains and losses (see Section B.1)	If an asset or a liability is measured initially at fair value, any difference between the transaction price and fair value is recognized immediately as a gain or loss in earnings unless otherwise specified.	An entity cannot recognize inception gains or losses for a financial instrument unless the instrument’s fair value is demonstrated by a quoted price in an active market for an identical asset or liability or is based on a valuation technique in which an entity uses only observable market data.
NAV practical expedient (see Section B.2)	An entity with an investment in an investment company may elect to use, as a measure of fair value in specific circumstances, the reported NAV without adjustment.	An NAV practical expedient for investments in investment entities is not provided.
Disclosures (see Section B.3)	There are differences between the disclosure requirements under U.S. GAAP and those under IFRS Accounting Standards. See Section B.3 for more information.

Footnotes

Differences are based on comparison of authoritative literature under U.S. GAAP and IFRS Accounting Standards and do not necessarily include interpretations of such literature.

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This publication provides comprehensive guidance; however, it does not address all possible fact patterns, and the guidance is subject to change. Consult a Deloitte & Touche LLP professional regarding your specific issues and questions.