| U.S.A.'s sub prime mortgage crisis once spreaded in 2007, initiately the financial crisis swept across the whole America, caused the global economic crisis finally. Financial institutions went bankrupt one after another, fair value is censured, it seems that it is a root of the trouble. Review history of U.S.A., fair value is used after the financial crisis erupted in the eighties of last century , in order to adapt to the development of the financial market. Historical cost measure doesn't adapt to changeable financial market, market value is seriously distorted. Today fair value is applied to a lot of corners of the financial accounting and doesn't merely exists in financial instruments. But it seems strangely that financial crisis broken out want to overthrow the application of fair value again. In fact it is exactly that the mankind studies a little setback of the economic law. Fair value has its desirable places, but undeniably it exposes all sorts of drawbacks, this needs to examine and summarize to the application of fair value. The development of a theory should always go through constant revision to reach completely, the theory development of fair value needs constantly revise in practice and improve too, as the financial accounting basic measurement attribute, this is its duty-bound mission too. The thesis proceeds with intension and importance of the profit, sum up the defect that the traditional accounting makes the profit. We should overcome the inherent defect of the traditional profit, must introduce fair value, make the profit approach the value and wealth even more, meet demands of investor. The article reviews the application of fair value in our country, development course, analyse in depth the necessity of the application of fair value, By Chinese listed company report data from 2007 to 2009, it is analyzed what the application of fair value in profit results , in the end , propose my own view on improvement and completion about the application of fair value. |
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