Recursivity in standard setting processes: the measurement case of fair value and market value

Annemarie Conrath-Hargreaves, Jens Heiling, Sonja Wüstemann

Research output: Contribution to journalArticleResearchpeer-review


Very little research has been published about how the conceptual underpinnings of standards developed at the global level might impact on their potential implementation at the local level and vice versa. Inspired by a normative approach to standard setting, this paper draws on the framework of recursivity to explore the role of the measurement objective and bases, as identified in the standard setting processes of the International Public Sector Accounting Standards Board (IPSASB). This paper contributes to the scarce literature on accounting standard setting processes in the public sector by addressing how conceptual underpinnings of standards developed by international standard setters at the global level may impact standard setting on the local level, and vice versa. 


The paper aims to contribute to our understanding of standard setting processes in public sector accounting by drawing on the measurement issue of fair value versus market value. The analysis highlights that uncertainty as to the meaning terms carry can lead to confusion at both the global and the local level, in particular, when the identification of measurement bases does not follow from the measurement objective. This is of practical relevance as it points to the importance of consistency in standard setting to avoid conceptual mismatches between the global and the local, which may endanger the global standard setter’s legitimacy. The paper offers a basis for policy-makers and managers to discuss conceptual mismatches between national and international accounting standards and the impact these decisions have on future accounting standard setting projects, not only at the global but also at the local level.

Original languageEnglish
Pages (from-to)192-202
Number of pages11
JournalPublic Money and Management
Issue number3
Publication statusPublished - 2021


  • Conceptual framework
  • measurement
  • objectives
  • public sector accounting
  • standard setting

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