Fair Value Measurement Model Research Of Application In China

As measurement attributes have a significant influence on the quality of accounting information, it is of importance in accounting information disclosure. In order to meet the needs of accounting information users'decision-making, improving the quality of accounting information by introducing and implicating fair value measurement model is necessary. However, there is no agreement on whether the fair value measurement model can achieve the aim. The occurrence of financial crisis in the U.S. intensified the challenge to the effect of the fair value measurement model. The range of application of fair value measurement model was expanded according to the new corporate accounting standards launched in 2007.The advantages and limitations of the fair value measurement model are studied in the paper. And the application of fair value measurement model in China is analyzed empirically. The first part introduces the concept, content and research results and depicts the application status in new accounting standards; In the second part, the relative advantages and limitations of the fair value measurement model, compared with the historical cost measurement model, are summarized after the analysis of numerous studies home and abroad; Finally, the impact of fair value measurement model on the accounting information quality is studied by analyzing the 2009 annual report of listed companies. The impact of profit and loss from fair value changes on net income is analyzed by statistical processing, descriptive statistics and correlation tests. The results show that the fair value measurement model can more fully reflects the financial position and increase the quality of accounting information. It can provide more objective and fair accounting information to users. At the same time, the results demonstrate that the application of the fair Value measurement model in China where the financial industry is not very developed, its pro-cyclical is not obvious, and it would not increase the volatility of the financial industry. Finally, recommendations on improving the fair value measurement model are displayed based on the research results.