Fair value (FV), as a measurement base, may not be always available due to specific reasons or factors. Alternative values that may be used as “reasonable” or “good” approximation to fair value include cost, net realizable value (NRV), carrying value, etc. For example, the carrying amount of the financial assets and liabilities that are not measured at fair value is usually considered a reasonable approximation of fair value.

Certain items are usually reported at net realizable value (NRV), such as trade receivables or accounts receivable, being amounts that are owed to an entity by its customers for products and services that have already been delivered. In which case, NRV is an approximation of fair value that is based on estimates of collectability.