Insurance Valuation based on net current replacement: This is defined as the cost of replacing one asset with another of a substantially similar nature. This is the most common form of valuation and is required by insurance companies for inclusion on a general household policy or a specialist collection policy.
Valuation for Financial Reporting: NZ IAS 16 and Treasury valuation guidance requires the use of the basis 'fair value'. Other equivalent terms are Market value, Open Market Value and Current Market Value. 'Fair Value' is defined as the amount for which an asset could be exchanged between two knowledgeable and willing parties in an arm's length transaction where both parties acted prudently and without compulsion.
Post Loss Valuation: Provides compensation for loss under existing insurance cover. The methodology applied is Replacement Value. This is defined as the cost of replacing one asset with another of a substantially similar nature.
Valuation for Estate Division: Forecast Realisable Value: This is defined as the forecast value of the items at auction at the date as specified.
Valuation for Relationship Property Division: Based on guidelines in the Relationship Property Act the correct basis being Forecast Realisable Value. This is defined as the forecast value of the items at auction at the date as specified.