Developing Discount Rates for Fair Value Reporting – Investment-Specific Risk
During this session, we will discuss developments in estimating inputs into the commonly used modified capital asset pricing model and the build-up method.
Format
Webcast
NASBA Field of Study
Accounting
Level
Advanced
CPE Credits
1.5
Instructor
Roger Grabowski
Availability
3 months
Product Number
WC5152638
This is a rebroadcast from the 2025 Forensic & Valuation Services Conference
There is much confusion and diversity of practice in developing discount rates for fair value reporting engagements particularly with regards to premiums for what has been called "company-specific-risk."
The guidance provided by FASB ASC 820 is sparse and can be confusing. Fair value measurement is an exercise in estimating the investment-specific-risks of the subject assets or liabilities.
During this session we will examine research on characteristics of "market participants" and how they establish discount rates.
We will review developments in estimating inputs into the commonly used modified capital asset pricing model and build-up method with focus on identifying and quantifying the specific risk characteristics of expected cash flows for assets or businesses, supported by recent academic research that can form the basis for supportable discount rates.
Key Topics
Learning Outcomes
- Identify resources for developing inputs into discount rates that match the risks of the expected cash flows with expected returns.
- Identify parallels between procedures for developing discount rates for fair value reporting engagements and those used in capital budgeting.
- Identify practices for measuring investment-specific-risk when developing discount rates for fair value reporting.
Who Will Benefit
Group ordering for your team
2 to 5 registrants
Save time with our group order form. We’ll send a consolidated invoice to keep your learning expenses organized.
Start order6+ registrants
We can help with group discounts. Email client.support@aicpa-cima.com
US customers call 1-800-634-6780 (option 1)
The Association is dedicated to removing barriers to the accountancy profession and ensuring that all accountancy professionals and other members of the public with an interest in the profession or joining the profession, including those with disabilities, have access to the profession and the Association's website, educational materials, products, and services.The Association is committed to making professional learning accessible to all product users. This commitment is maintained in accordance with applicable law. For additional information, please refer to the Association's Website Accessibility Policy. As part of this commitment, this product is closed-captioned. For additional accommodation requests please contact adaaccessibility@aicpa-cima.com and indicate the product that you are interested in (title, etc.) and the requested accommodation(s): Audio/Visual/Other. A member of our team will be in contact with you promptly to make sure we meet your needs appropriately.