The six largest global firms have issued a paper on determining fair value in response to concern among account users and preparers over the unstable market conditions.

Concerns were also raised by G7 finance ministers and Central Bank Governors who requested the Financial Stability Forum to review and report on certain aspects of the recent market turmoil, which included valuation issues.

The paper, issued through the Global Public Policy Committee, aims to highlight the requirements of IFRS determining fair value of financial assets, liabilities and related disclosures in the context of current market conditions.

In a statement today, the firms said the paper did not amend or interpret IFRS but merely set out the requirements that have to be met when calculating fair value.

A similar effort was made by the US Centre for Audit Quality in relation to fair value calculations under US GAAP.

Dick Kilgust, chair of the firms' Global Public Policy Committee said it is important that the large firms have come together to work on these issues.

'The valuation issues are complex and it is the first time that IFRS has been applied extensively in difficult market conditions. While it is not our job to provide interpretation of the standards or valuation guidance, we believe that drawing attention to the key issues should promote compliance and consistency around the world,' said Kilgust.

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