IFRS 13 - Fair Value Measurement is a guideline set by the International Financial Reporting Standards (IFRS) to provide a uniform foundation for measuring and disclosing fair value in financial reports. It specifies how to measure fair value and the information required to be disclosed about fair value measurements. IFRS 13 applies when another IFRS requires or permits fair value measurements or disclosures, such as for investment properties or financial instruments.

For example, when valuing a derivative instrument under IFRS 13, an entity must use observable market data when available and categorize the results into the IFRS 13 fair value hierarchy. This ensures consistency and comparability between companies reporting fair value across different industries and geographies.

By requiring clear disclosures, IFRS 13 enhances transparency and aids stakeholders in understanding the valuation methods and inputs used. It also establishes consistency in fair value measurement, critical for accurate balance sheet reconciliations and consistent reporting.