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White Paper

Debt valuation methodologies for financial reporting


Debt valuation has long been a topic of debate among entities required to report fair value. Because of varied interpretations of accounting standards, methodologies for valuing debt have ranged from simply reporting the remaining principal balance to an application of complex algorithms. This wide variance in methodologies can result in inconsistent results and volatility not reflective of market conditions.

The following resources facilitate the appropriate application of valuation principles by providing a framework for measuring the fair value of debt that is rooted in a careful observation of relevant markets.

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