The ASB has placed on this website a paper ‘Liabilities and how to account for them’ by Andrew Lennard, Director of Operations. This develops the theme of the article in Inside Track 32, July 2002: ‘Liabilities - entry or exit price?’

The paper explores the application of the value to the business (or 'deprival value') model and suggests that it provides a rationale for stating liabilities at entry values in many cases. It illustrates the application of this thesis to many controversial areas in accounting, and suggests that it leads to solutions different from those in existing and proposed accounting standards.

The Board is publishing the paper at this time, as it believes it is relevant to many issues that standard-setters are currently considering, including revenue recognition, the basis of measurement and the definition of elements of financial statements.

The paper may be downloaded from www.asb.org.uk/public/downloads.cfm