Determining the value of assets and liabilities affects items presented in the balance sheet (statement of financial position of the entity). What is more, it defines the financial result of the company. Given the fact that one of the tasks of accounting is to provide the information about the economic value of the entity, fair value began to be popular both for the initial valuation and for the balance sheet valuation. This valuation parameter, corresponding to the arm’s length value by definition, has become a source of great controversy, mainly due to accounting abuse.
Poland
