Calibration in Practice: When It Informs Fair Value and When It Obscures It

The principle of calibration is foundational to fair value measurement. Yet, in practice, it is often misapplied as a mechanical rule rather than a tool to inform expert judgment.

Our latest white paper provides a critical framework for today’s valuation professionals. This report details how to:

• Move beyond a mechanical approach to align with authoritative guidance from FASB and IFRS.

• Reassess the relevance of a calibration transaction at each measurement date.

• Incorporate forward-looking analysis by evaluating evolving business fundamentals and market participant expectations.