SVS No. 10 Valuation of Machinery and Equipment


Issued by Valuation Standards Committee in Taiwan on 11 December, 2014.


This Statement establishes the basic principles and application guidance for valuation of machinery and equipment. Items of machinery and equipment are tangible assets that are held by an entity for use in the production or supply of goods or service, for rental by others or for administrative purposes.
When valuers undertake valuation of machinery and equipment, they should identify the purpose of valuation, decide applicable standard of value, confirm the selected premise of value, and consider all relevant factors about the underlying machinery and equipment. Items of machinery and equipment may be subject to a financing arrangement; in such cases, it may be appropriate to identify any encumbered assets and to report their values separately from the unencumbered assets.
The main approaches used in valuation of machinery and equipment are market approach, cost approach and income approach. For classes of plant and equipment that are homogenous, the market approach is commonly used as there is sufficient data of recent sales of similar assets. The cost method is mainly used for the valuation of machinery and equipment with no active markets. The income approach can only be used where specific cash flow can be identified for the machinery and equipment.
Finally, this Statement requires valuation report on machinery and equipment to be prepared in accordance with SVS No. 03 Valuation Report.

Effective date

This Statement is effective from 25 December, 2014.

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