Accounting valuation definition

What is an Accounting Valuation?

An accounting valuation is the inclusion of assets and liabilities in the accounting records of an organization in accordance with the valuation rules of the applicable accounting framework. There are a number of required valuation methods, including historical cost for fixed assets and market value for marketable securities. There is a general trend towards allowing or requiring more assets and liabilities to be valued at their market values.

A proper accounting valuation is needed for each line item presented in the financial statements, so that analysts can properly evaluate the financial results and financial condition of a business.