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Article
The FASB's Concepts Statement on Cash Flows and Present Value
Journal of Applied Business Research (2003)
  • Thomas D Berry
  • Stanley Martens
Abstract

In February 2000, the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Concepts No. 7, Using Cash Flow Information and Present Value in Accounting Measurements. In this document the FASB asserts without proof that a present value computation along its lines will provide a good estimate of the fair value of an asset or liability. Using numerical examples provided by the FASB, we attempt to construct arguments in support of the FASB’s claim. We find that such arguments require strong and not at all obvious assumptions about players in hypothetical markets.

Publication Date
Fall 2003
Citation Information
Thomas D Berry and Stanley Martens. "The FASB's Concepts Statement on Cash Flows and Present Value" Journal of Applied Business Research Vol. 19 Iss. 4 (2003)
Available at: http://works.bepress.com/thomas_berry/7/