The recoverable amount is computed as the higher of value in use and fair value less costs of disposal. Fair value assumes recovery of the asset through its sale. Fair value is an objective, market participant, value, which is independent from the specific company, where market prices and market information are incorporated in its determination. Further guidance on fair value measurement is contained in section 3.6.
Value in use assumes recovery of the asset through its use. Value in use is an entity-specific measure, determined in accordance with the entity’s view of use of the investment property. It is a present value measure, in which cash flows incorporate the estimates of the entity rather than the market. Nevertheless, an entity should place greater reliance on market data and corroborate its estimates with external information.