Research On Fair Value Of Derivative Instrument In Listed Commercial Bank

Under the influence of the global financial crisis, derivative financial instruments were pursuited by financial professionals yesterday, but today are called to question. As the hot question with fair value measure, were generally considered the culprit of this crisis from the penetration of the financial bubble to bubble. Who is it, Where is his future, it caused great attention of the financial sector and became to a top priority of financial accounting standards. In order to strengthen international ties, China in 2006 issued new accounting standards, of which four are on the accounting treatment of financial instruments. The new guidelines makes up the lack of our country's financial accounting guidelines, they integrated decentralized accounting system to form a coherent and complete financial accounting standards. At present, China mainly focus on derivatives trading in the listed banks, coupled with the new accounting standards in the first application of the listed banks, the banks in the accounting treatment of derivative financial instruments, the experience of other companies derivatives trading will play a guiding role.In this paper, we will review the definition of fair value and accounting measurement methods together. At the same time, we will take fair value method with the other method, t the international accounting standards on fair value with national guidelines by contrast. These work will be preparation for the post paper.Firstly, take the financial reports of 12 listed banks for example, analyze the situation that range of Derivative financial instruments, derivative financial assets (liabilities), changes in fair value of the impact on profit before tax situation from 2007 to 2009.Second, analyze the situation of listed bank run the Financial Accounting Standards after it published at 2006.Most listed bank can comply with the requirements of the guidelines, but it still has some problems. In this paper, we use quantitative and qualitative analysis to find the issues in implementation: short of Derivatives species; immature development of financial markets; complex changes in foreign exchange rates and interest rate reduce the value of Derivatives; financial information disclosure is not sufficient because of the low capacity of professional accountants.Finally, on the basic of the problems reflected in the results and previous research, in order to make the method of Fair value on Derivative financial instruments, we suggest that improve financial markets instruction, extensive derivative products range, provide valuation guides and enhance the quality of professionals.