RICS Draft Update to the Global Red Book

Red Book Global Update 2022 - Proposed Changes

VPGA 1: Valuation for inclusion in financial statements

2.2 In March 2021, the International Accounting Standards Board published the exposure draft Disclosure Requirements in IFRS Standards-A Pilot Approach. The exposure draft sets out a proposed new approach to developing and drafting disclosure requirements in IFRS standards, as well as new disclosure requirements for IFRS 13 Fair Value Measurement.

From the valuation community perspective, the most noteworthy potential change is the expectation or requirement that information will be provided to clients as a matter of course on what are described as 'reasonably possible alternative fair value measurements', to reflect the uncertainty that may exist regarding any significant inputs used to determine fair value. 

2.3 IFRS 16 Leases, introduced in 2016, sets out the principles for the recognition, measurement, presentation and disclosure of leases. IFRS 16 is effective for annual reporting periods beginning on or after 1 January 2019, with earlier application permitted. 

IFRS 16 introduces a single lessee accounting model and requires a lessee to recognise assets and liabilities for all leases with a term of more than 12 months, unless the underlying asset is of low value. A lessee is required to recognise a right-of-use asset representing its right to use the underlying leased asset and a lease liability representing its obligation to make lease payments.