Which basis is primarily used for reporting assets on personal financial statements?

The primary basis used for reporting assets on personal financial statements is current fair market value. This approach reflects the price at which an asset could be sold in an open market under normal conditions, providing a relevant measure of the asset's worth at any given time.

Fair market value is significant for personal financial statements as it presents a more accurate reflection of an individual's financial position, aligning with how assets are valued in practice when assessing personal net worth. This assessment is particularly important for decision-making, investment evaluations, and overall financial planning.

Historical cost refers to the original purchase price of an asset, which may not accurately reflect its current market value due to depreciation, appreciation, or changes in market conditions. Taxable basis often considers only the value relevant for tax purposes, which may not align with fair market considerations. Amortized cost relates more to the gradual writing down of asset values and is commonly used in accounting for long-term assets rather than personal financial reporting.

Thus, current fair market value is preferred for its relevance and practicality in presenting an individual’s true asset worth.