A market that is used, in absence of a principal market, to obtain pricing information about the sale of an asset or the transfer of a liability at the measurement date. In other words, the exit market comes into existence, actually or hypothetically, upon sale (disposal) of an asset or transfer of a liability under current market conditions. To arrive at fair value, the entity should assume that a transaction will be entered into at that date, with value being considered from the perspective of a market participant that holds the asset or owes the liability.

This assumption provides a basis for estimating the exit price: the price that would received from the sale of the asset or the transfer of the liability.