## GFS Notice of Decision: 1.1 Valuation Principles and Methodologies

## Source details

**Canonical URL:** [GFS Notice of Decision: 1.1 Valuation Principles and Methodologies](https://www.imf.org/-/media/files/data/statistics/gfsm/global-consultations/research-projects/notice-of-decision-gfsm-2014-update-11-valuation-principles-and-methodologies.pdf)

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### Scope of the update
- The updated GFSM will incorporate a number of clarifications around valuation principles and methodologies, in line with the draft 2025 SNA and draft BPM7.
- GFSM 2014 paras. 3.107-3.129 will be updated in line with text on the valuation of transactions (paras. 4.130-4.152) and valuation of stocks (paras. 4.153-4.166). Other references to valuations in the remainder of the GFSM 2014 will be revised accordingly.
- The comparison on valuation principles used in business accounting in the draft 2025 SNA (paras. 4.167-4.168) will be considered for inclusion in the updated GFSM.

### Key valuation principles to be adopted or clarified
- Adopting the terminology of “exchange price” as the basis to determine “exchange values” to describe the principle for valuing transactions and stocks positions, respectively, as well as providing clarifications on the application of this principle.
- Clarifying the different methods for valuing transactions (and their order of preference).
- Explicitly referencing the distinction between the initial recognition and subsequent measurement of stock/positions.
- Further clarifying the valuation principles for valuing positions, in particular for nonfinancial assets where the notion of capital services needs to be introduced and elaborated.
- Clarifying the application of the valuation principle for various assets, including for natural resources.
- Include a short summary of comparisons of the valuation principles used in macroeconomic statistics with those used in business and public sector accounting.

### Intended methodological clarifications and emphasis
- Emphasize the primacy of “exchange price” terminology for establishing exchange values for both transactions and stocks.
- Set out an ordered set of methods for valuing transactions and make clear the preferred sequence among alternative valuation approaches.
- Distinguish clearly between:
  - initial recognition of stock/positions, and
  - subsequent measurement of stock/positions.
- Introduce and elaborate the role of capital services when valuing nonfinancial assets.
- Provide specific guidance on the valuation principle’s application to natural resources.
- Offer a concise comparison between macroeconomic valuation principles and those used in business and public sector accounting (drawing on draft 2025 SNA text).

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_Source: https://www.imf.org/-/media/files/data/statistics/gfsm/global-consultations/research-projects/notice-of-decision-gfsm-2014-update-11-valuation-principles-and-methodologies.pdf_