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Recital 2

Recital 2

(2)Where the application of prudent valuation would lead to a lower absolute carrying value for assets or a higher absolute carrying value for liabilities than recognised in accounting, an additional valuation adjustment (AVA) should be calculated as the absolute value of the difference between the two, as the prudent value should always be equal to or lower than the fair value for assets and equal to or higher than the fair value for liabilities.

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