Valuation Of Direct Investment Equity Stocks
- Topics:
- Foreign Direct Investment
- Tags:
- Currency & Foreign Exchange,
- Equity,
- European Central Bank,
- Finance,
- Foreign Direct Investment,
- Foreign Direct Investment (FDI),
- Investment,
- Market Price,
- Valuation
- Source:
- European Central Bank
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Overview: The lack of clear guidance from international statistical standards and the practical difficulties to apply the main recommendations may explain the current state of play. Both the IMF Balance of Payments Manual (BPM5) and the OECD Benchmark Definition of Foreign Direct Investment (B-FDI) promote the use of market prices as the basis of valuation for both transactions and stocks. International statistical standards for national accounts also prescribe the use of market prices for the valuation of assets when they exist. On practical grounds, it should be borne in mind that compilers usually have to face more difficulties to access market quotation information in the case of outward FDI. However, it can hardly be argued that this may justify the existence of asymmetries.
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Format: PDF | Size: 122KB | Date: Apr 2004 | Pages: 6
