Private Equity Fair Value Measurement: A Critical Perspective on IFRS 13

In this paper, we discuss IFRS 13 with regard to private equity valuation. We raise issues on the fair value definition as an exit price and question the reliability of valuation techniques which are categorized into Level 2 fair value hierarchy. Our paper questions whether fair value as defined by IFRS 13 is an appropriate measure for private equities and can contribute to enhancing transparency and comparability in financial statements, which is one of the purposes of the IASB and the European Union Regulation 1606/2002.