Fund accounting

Net Asset Value (NAV)

Net asset value (NAV) is the total value of a fund's assets minus its liabilities at a point in time. Dividing NAV by the number of units or shares gives NAV per unit, the price at which investors subscribe or redeem in open-ended funds and the basis for reported value in closed-end funds.

Fair Value Hierarchy

The fair value hierarchy, set out in IFRS 13, ranks the inputs used to value an asset by reliability. Level 1 uses quoted prices in active markets, Level 2 uses other observable inputs, and Level 3 uses unobservable inputs and management judgement. Funds disclose how much of their portfolio sits in each level.

IFRS 9 / SFRS(I) 9

IFRS 9, called SFRS(I) 9 in Singapore, is the accounting standard for financial instruments. It classifies each instrument by the entity's business model and whether cash flows are solely payments of principal and interest (SPPI), then measures it at amortised cost, fair value through OCI, or fair value through profit or loss, with expected credit loss for impairment.