Research On The Disclosure Of Accounting Information About Derivative Financial Instruments Of The Non-Financial Listed Companies In China

In recent years, in the wave of financial liberalization and economic globalization, the innovation of financial instruments, especially the innovation and the use of derivative financial instruments, to some great extent stimulate the development of the global economy. Many global multinational corporations to avoid risks or speculate generally throw their sights on derivative financial products. Of course, our national companies are no exception. Many of our large financial and non-financial listed companies for purposes of avoiding the risks of commodity price, interest rate resulting from loan and foreign exchange because of importing and exporting, actively use financial derivative products and regard them as main tools for risk aversion. But these financial derivatives not only has promoted the rapid development of the global economy, but also has brought potential and huge risks to businesses and even global economy.Then when financial turmoil sweeping all over the world caused by subprime mortgage crisis of America has not yet gone, China SASAC published an article, disclosing that there are68central enterprises to get involved in derivative financial products and lose11.4billion yuan. So how to effectively prevent the risks of derivative financial instruments to bring has naturally become a hot issue to the financial sector and the accounting profession. With the depth of its research, it was found that the full, specific, and transparent disclosure of accounting information not only can encourage enterprises to strengthen internal and external management, and effectively prevent the risks of derivative financial instruments brought to enterprises, but also contribute information users to make appropriate investment and financing decisions in order to protect the vital interests of information users.As we all know, in the process of derivatives trading, the financial sector to the banking sector as the main representative not only can act as a financial derivative transactions’s traders and brokers, and can also act as end-users of financial derivatives. The risks on the type and quantity are different due to the different roles of commitment. Therefore, the People’s Bank of China, China Banking Regulatory Commission, Securities and Futures Commission, Ministry of Finance and other regulatory authorities have issued a lot of documents to make it standard. In contrast, the number of use of non-financial listed companies in the financial derivatives and information disclosure transparency is slightly less than financial listed companies. In2006, Ministry of Finance released a new corporate accounting standard, which makes clear provisions about derivative financial instruments’s recognizion, measurement, presentation and disclosure. However, most of the provisions are in principle, too general and relevant application guide is also lack of appropriate explanation.As a result, there are still many problems about information disclosure of derivative financial instruments in practice.This paper will use standardize research methods to investigate derivative financial instruments accounting information disclosure of non-financial listed companies in China. This paper investigates and analyzes the actual situation of our national non-financial listed companies on the basis of comparative analysis of the provisions of relevant criteria both in domestic and abroad, and explores how to further improve accounting information disclosure of derivative financial instrument held by non-financial listed companies in China.This article is divided into six sections.The first part is the introduction.It mainly introduces the research background, the study significance, research methods and research ideas.The second part describes briefly the meaning, recognition and measurement of derivative finance instruments.After reading a lot of domestic and international current standards, I carry on the contrast analysis and cause some reflection to our country current situation.The third part is some factors of disclosure of accounting Information about derivative financial Instruments of the non-financial listed companies in China.Discuss why they hold derivative finance instruments and the characteristics and necessity of the disclosure of accounting information. Finally, explores its ultimate goal, namely, how to improve the transparency of information disclosure.The fourth part is about present status aimed at the problem and analyzing what the reasons are. First, describe briefly the use of situation on the derivative financial instruments of the non-financial public companies in our country.According to previous studies, the rusults show that at present the enterprises which are using derivative financial instruments are large, which have a larger asset size and a top-ranking in their industry.Besides,these companies’s accounting information disclosure are more standardized.So I selected20large non-financial listed companies to investigate and analyze.Secondly, according to the survey, we found that information disclosure is inconsistent, inadequate about the fair value, not specific about risk information as well as information disclosure is not timely.We found their reasons aimed at existing problems, including accountant lacking of the experience of derivative financial instruments, accounting standards being too general and poorly operable, enthusiasm of voluntary Disclosure being not high and professional quality of the accountant being uneven.The fifth part mainly provides many improvements from the standards setting, internal control and external supervision.The sixth part is about deficiencies and prospects.