Models for Estimating the Fair Value of a Green Energy System
Author:
Ileana Monica JULEAN, Ph. D. Student; Teodora Alexandrina BORFOAIA, Ph. D. Student
JEL:
Q42, C26, G17
DOI:
Keywords:
green energy, fair value, income method
Abstract:
Determining the fair value for the assets of an entity is very often a real challenge.\r\nAs it is stated in the economic literature and in the national regulations too, the fair value is the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm`s length transaction.\r\nBut there are a lot of cases when an entity can not have information from a regulated market.\r\nIn these cases the entity should take into account other estimation models in order to assess the fair value of an asset.\r\nThe model an entity choose should be well documented because the result of the estimation method is the fair value of an asset which shall be recognized in the annual financial statements and shall have an effect on every performance indicator of the entity.\r\nThe model should also be simple and clear in order to allow the auditors to express an opinion when auditing the financial situations.\r\n\r\n\r\n\r\n