about apple ...how to do the strategis analysisThere's an argument whether fair value is the most relevant measure for financial reporting, Or historical cost, that provides a more useful measure because it more clearly represents the economics of business performance, and because fair value estimates may not be reliable or verifiable.
What is important that financial institutions follow sound accounting policies and practices, to support improved transparency and enhanced financial disclosures, which promote market discipline and provide useful information to decision makers.
If markets were liquid and transparent for all assets and liabilities, fair value accounting clearly would be reliable information useful in the decision-making process but the inputs and methods for estimating their fair value are more subjective and, therefore, the valuations less reliable. The FASB statement on the proposed fair value standard suggests that reliability can be significantly enhanced if market inputs are used in valuation. However, because management uses significant judgment in selecting market inputs when market prices are not available, reliability will continue to be an issue.
The proposal identifies three levels of estimates that are based on mark-to-model. The proposal suggests that the use of multiple approaches, such as the market, income, and replacement-cost methods, will improve reliability of these estimates if all the methods are based on the same underlying information, as would often be the case for financial instruments.
without reliable fair value estimates, the potential for misstatements in financial statements prepared using fair value measurements will be even greater, which leads to the importance of verification to place greater e ...