Ind AS 113
Active
Fair Value Measurement
Provides a single framework for measuring fair value, including a three-level hierarchy and valuation techniques, substantially converged with IFRS 13.
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Conceptual Framework Linkage
Identical exit-price philosophy to IFRS 13
Ind AS 113 applies the IDENTICAL definition as IFRS 13 – fair value is the price that would be RECEIVED to sell an asset or PAID to transfer a liability in an orderly transaction between MARKET PARTICIPANTS at the measurement date – a market-based, NOT entity-specific, exit price notion.
HOW IND AS 113 MAPS TO THE FRAMEWORK
Comparability – a SINGLE fair value framework applied consistently across all Ind AS standards requiring fair value measurement – identical to IFRS 13 Faithful representation – the fair value hierarchy prioritises OBSERVABLE market data over unobservable estimates – identical to IFRS 13 Interaction with India's valuer regulatory framework – Ind AS 113's fair value MEASUREMENT principles operate alongside the Companies Act/IBBI's Registered Valuers framework, which governs WHO is legally qualified to perform certain statutory valuations in India – a genuinely important practical, though not accounting-substantive, Indian consideration
Ind AS 113 introduced NO change to the fair value definition relative to IFRS 13 – India's distinctive feature lies in its professional valuer REGULATION, not the accounting framework itself.
The three-level hierarchy – identical to IFRS 13
LevelInput type
1Quoted prices in active markets for IDENTICAL assets/liabilities
2Observable inputs OTHER than Level 1 quoted prices
3UNOBSERVABLE inputs
IDENTICAL hierarchy structure to IFRS 13.
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Scope & Applicability
What Ind AS 113 covers
Ind AS 113 applies WHEN another Ind AS requires or permits fair value measurement/disclosure – IDENTICAL "framework, not trigger" scope to IFRS 13, with the SAME scope exclusions (share-based payment, leases, NRV-based inventory measurement).
Key definitions you must know
Fair value
IDENTICAL definition to IFRS 13 – an exit price notion.
Registered Valuer
A professional registered with IBBI (Insolvency and Bankruptcy Board of India) under the Companies (Registered Valuers and Valuation) Rules, 2017, required for certain statutory Indian valuations.
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The Fair Value Definition – Exit Price
Identical to IFRS 13
The PRINCIPAL market (or most advantageous market, absent a principal market) determines the relevant price – IDENTICAL to IFRS 13, with NO Indian-specific modification to the underlying definition.
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The Fair Value Hierarchy
Identical classification approach to IFRS 13
Example 1: Classifying an Indian company's fair value inputs
An Indian company holds NSE-listed equity shares (quoted daily), a corporate bond priced using observable yield curves from comparable rated Indian bonds, and an unlisted startup equity investment valued using a discounted cash flow model with company-specific growth assumptions.
NSE-listed equity: Level 1 (quoted price, active market)
Corporate bond: Level 2 (observable yield curve inputs)
Unlisted startup investment: Level 3 (unobservable company-specific assumptions)
An IDENTICAL classification methodology to how IFRS 13 would categorise the same instruments globally.
Corporate bond: Level 2 (observable yield curve inputs)
Unlisted startup investment: Level 3 (unobservable company-specific assumptions)
An IDENTICAL classification methodology to how IFRS 13 would categorise the same instruments globally.
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Valuation Techniques
Identical three approaches to IFRS 13
Market approach, cost approach, income approach – IDENTICAL to IFRS 13, maximising observable inputs and minimising unobservable inputs.
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Highest and Best Use – Non-Financial Assets
Identical to IFRS 13
Fair value of a non-financial asset considers a market participant's ability to generate value through its HIGHEST AND BEST USE – IDENTICAL to IFRS 13, relevant for Ind AS 40 investment property and Ind AS 16 revaluations.
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Registered Valuers – The Indian Regulatory Context
A genuinely important Indian professional regulation layer
The Companies (Registered Valuers and Valuation) Rules, 2017 (under IBBI) require CERTAIN statutory valuations (e.g. for company law purposes such as mergers, share allotments) to be performed by a REGISTERED VALUER – a specific professional qualification. This governs WHO may perform certain Indian statutory valuations, operating ALONGSIDE Ind AS 113's own fair value MEASUREMENT methodology, similar in spirit to how SEBI/RBI/IRDAI regulate other specific sectors.
Example 2: Registered Valuer requirement for a share swap ratio
An Indian company undergoing a merger under Sections 230-232 of the Companies Act, 2013 requires a fair value-based share exchange ratio determination.
This valuation MUST be performed by a Registered Valuer under IBBI rules – a REGULATORY requirement governing WHO performs the valuation – while the underlying fair value MEASUREMENT PRINCIPLES applied (market participant perspective, valuation techniques, hierarchy) remain governed by Ind AS 113, IDENTICAL to IFRS 13's own framework.
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Fair Value at Initial Recognition
Identical to IFRS 13
Transaction price is presumed to equal fair value at initial recognition unless evidence indicates otherwise (e.g. related party transactions, forced transactions) – IDENTICAL to IFRS 13.
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Disclosure Requirements
Identical disclosure requirements to IFRS 13
Fair value hierarchy classification for each class of asset/liability Valuation techniques and inputs used Level 3 reconciliation and sensitivity analysis
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Critical Judgments & Estimates
Where management judgement matters most
SIGNIFICANT JUDGEMENTS
Identifying the principal (or most advantageous) market Fair value hierarchy level classification
SIGNIFICANT ESTIMATES
Level 3 unobservable inputs, particularly for unlisted Indian equity/startup investments
For India's large UNLISTED company and startup ecosystem, Level 3 fair value estimation is genuinely prevalent and requires careful, well-documented valuation methodology, often necessitating Registered Valuer involvement for statutory purposes.
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Ind AS 113 vs IFRS 13 – Full Comparison
Comprehensive comparison table
FeatureIFRS 13Ind AS 113
Fair value definition & hierarchyExit price, three-level hierarchyIDENTICAL – no substantive divergence
Statutory valuer qualification requirementVaries by jurisdictionIBBI's Registered Valuers framework governs WHO may perform certain Companies Act statutory valuations – a genuinely Indian regulatory layer
Ind AS 113 is essentially IDENTICAL to IFRS 13 in substance – its distinctive Indian relevance lies in the professional Registered Valuer regulatory requirement, not any accounting divergence.
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Statement Mapping
Where every Ind AS 113 disclosure lands
Disclosure itemLocationNotes
Fair value hierarchy classificationNotesIdentical to IFRS 13
Level 3 reconciliation/sensitivityNotesIdentical to IFRS 13
Fair value adjustment on remeasured assetP&L OCI Balance SheetLocation depends on the specific Ind AS requiring the measurement
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Related Standards
Cross-reference map
StandardConnection
IFRS 13The global counterpart standard, near-identically converged
Ind AS 109 / 40 / 16Frequently require fair value measurement using Ind AS 113's framework
Companies (Registered Valuers and Valuation) Rules, 2017Governs who may perform certain Indian statutory valuations
Quick-reference glossary
IBBI
Insolvency and Bankruptcy Board of India – the regulatory body overseeing India's Registered Valuers framework.
Principal market
The market with the greatest volume/level of activity for the asset/liability – identical concept to IFRS 13.
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Glossary
Fair value
The price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date – IDENTICAL definition to IFRS 13.
Registered Valuer
A professional registered with IBBI under the Companies (Registered Valuers and Valuation) Rules, 2017, required for certain statutory Indian valuations.
Principal market
The market with the greatest volume/level of activity for the asset/liability – identical concept to IFRS 13.
Highest and best use
The use of a non-financial asset by market participants that would maximise the value of the asset – identical concept to IFRS 13.
Financial statement key
BS Balance sheet
IS Income statement
SE Statement of changes in equity
OCI Other comprehensive income
SCF Statement of cash flows