Research On Information Correlation Of Fair Value Accounting In The Post-Financial Crisis Era

As a maker of financial position and operating management information, accounting, this has been committed to provide true and relevant information to stakeholders of the corporate through the measurement of the main functions of the properties. With the development of the information society, people gradually change the quality requirements of accounting information, so as the accounting standards, which made corresponding changes. According to the regularity of the historical development, we can easily find every controversy behind the historical changes of accounting standards and accounting attributes have a profound economic and social background.Form the viewpoint of the measurement attributes, there has always been a controversy on the issue of fair value. Since the beginning of the fair value had been produced, the controversy that measurement can provide the relevant and reliable information has been existed. Meanwhile, the U.S. subprime mortgage crisis triggered by the global financial crisis in2008intensified the debate. No matter the viewpoint from theory or practice, the research on fair value accounting is bound to become an important issue in the accounting profession in the future.In recent years, fair value in China has been in a certain degree of development. Since the new2006accounting standards for enterprises, we can find of the large content of fair value accounting, as much as the breadth of the subjects involved. The rare case of the financial crisis in2008, however, allows us to see the drawbacks of fair value accounting. Today in the background after the financial crisis and the Convergence of International Standards, whether it should continue to develop the fair value accounting, especially in the financial industry that fair value accounting is widely used. How to prove the correlation between it with accounting information? This problem becomes an important issue should be solved.This dissertation attempts to analyze the positive correlation between fair value accounting and accounting information under the background of post-financial crisis era.On the one hand, the dissertation not only explain the theory of value of correlation, fair value and so on, but review their development as well, on the other hand, in order to improve the quality of fair value that is used in the financial industry and make policy recommendations, the dissertation collect the data of the2010-2011years for the Chinese A shares listed in the financial industry and make empirical analysis.The dissertation obtains these chapters:(l)IntroductionThe chapter describes the research background and significance, research methods and ideas, the main contribution of this paper and inadequacies.(2)Literature ReviewAs the theoretical and empirical analysis of the chapters’later pave the way, this chapter mainly boasts the following sections:First, this chapter collected the related literature of the definition in the concept of post-financial crisis in recent years. Second, the financial crisis as a watershed, this chapter has a review of the development of fair value accounting, and holds the view that the development of fair value has ups and downs, but overall in line with the development of the times. Third, from domestic and international perspective on correlation of fair value, this chapter review the related literature and make final commentary on the above literature, that the current domestic and international research is particularly have controversy on the existence of the fair value of the positive correlation, such controversy exists when the economic and social volatility factors appear. Current post-financial crisis era fits the condition, so the verification of the fair value after the financial crisis is necessary.(3)The theory perspective of analysis on fair value measurement modelFirst, the efficient market hypothesis theory and decision usefulness as a guide, this chapter systematically explain the value correlation theory. Second, the paper describes the fair value of its own theory, including:the causes of the fair value and the historical background, the definition and the three theoretical analysis of the fair value, which specifically set forth its market base and the basis of the price level. Third, this chapter lists the Lehman Brothers and Banks of Communication (China) as the examples of "pro-cyclical affection" in the financial industry. Fourth, this chapter raise the question——which accounting measurement model under the post-financial crisis should be chose.(Fair value accounting vs. historical cost accounting)(4) Empirical testing and analysis of correlation of the fair value accountingThis chapter draws the results as follows:First, listed in the2010-2011financial industry, in the background of post-financial crisis, a significant positive correlation between the fair value of assets and stock exist. In addition, we also believe that the influence of the previous financial crisis, the financial sector tends to be conservative in terms of investment in financial asset.Second, based on the2011listing of the financial industry samples, in the background of post-financial crisis, the amount of change in fair value included in the income statement for the part with the current stock yields a degree of positive correlation, but due to the small sample size and variable design and other reasons, the degree of correlation is not obvious enough. On this basis, the dissertation added the amount of changes in fair value recognized in other comprehensive income part, to enhance the goodness of fit at the same time, changes in fair value accounting information has once again prove the positive correlation. At the same time, the dissertation argues that some financial statements for the current financial industry information is market-oriented, its reliability needs to be verified. The financial industry is also preferred to choose more controllable available-for-sale financial assets.Third, according to the financial industry, this chapter divides the samples into three sub-sectors. The first sample point of analysis of the different characteristics of the financial sub-sectors and analyzes the distribution of stock returns RET in different sub-sectors. Then make regression analysis of new samples.(5) Policy recommendations on improving the fair value measurement of China’s financial industry under the background of post-financial crisis.This chapter first proposed the existing problems in China’s financial industry, and on this basis to make policy recommendations, aimed at improving the use of fair value measurement in China’s financial industry-that is, from the market point of view, from the Accounting Standards for Business Enterprises angle, from the legal environment angle and from the financial industry accounting personnel professional judgment angle. The policy recommendations are as follows:Market point of view-due to the late start of China’s capital market, coupled with strong government intervention, the fair value of the applicability of the problem has been much debated. With the development of global financial markets, and the acceleration of the process of internationalization of China’s financial industry must ultimately to reach international standards in the post-financial crisis and to improve China’s financial industry in the global economic status and role. Therefore, China should strengthen the building of a market economy; make efforts to improve the degree of perfection of the market.The ASBE angle-although in accordance with the requirements of the Ministry of Finance, the listed financial companies need to perform corporate accounting standards, but the financial sector and the non-financial sector differences, especially the differences which is particularly evident in the annual report disclosed the information that confuses the investors. This chapter is recommended for the financial industry, especially for our fair value in the financial industry side, similar to the2011International Accounting Standards, the separate introduction of appropriate accounting standards or interpretations in order to standardize and improve the financial sector accounting information.Fair value environmental and the financial industry accounting personnel professional judgment angle-increase social supervision and audit efforts, meanwhile improve the legal environment for the implementation of fair value measurement. It is necessary to establish the early warning system in line with the financial industry, and timely monitor the changes in the value of the market, put an end to unnecessary losses. In addition, to improve the professional judgment of the financial industry accounting personnel, thereby enhancing the extent of regulation of the industry as a whole, to improve the quality of accounting information which make the market more rational.The main research contributions are as follows:(1) Since our empirical research of correlation of the fair value information is still in the development stage, we find that recent studies there are two defects when the related literature is collected:on the one hand, the lack of economic times background factors; the other hand, most of the content of the studies are about the contrast of the enterprise implementation under the old and new enterprise accounting standards. This dissertation is based on the post-financial crisis era and does the empirical research on the correlation of fair value of the information. From this perspective, the research so far is not large; the dissertation hopes to compensate for correlation blank.(2) the object of this dissertation is listed on the A-share financial industry in2010-2011, which belongs to the latest data, meanwhile, different from most of the empirical research on the whole inertia, this dissertation aims at financial industry, which is more targeted and rational.(3) In this dissertation, in addition to the use of the traditional models, we still set the analysis on the sub-sectors of the financial industry. We classify the three sub-industry sample to interactive regression analysis, from the more detailed view to explore each degree of correlation in the financial sub-sectors. This point is new in recent empirical research.The inadequacies of this article are:(1) the concept of post-financial crisis is so new that there is a certain degree of difficulty of collection associated literature, which may cause the weak analytical capacity.(2) The overall sample size is small. The object of this paper is listed A shares of the financial sector, on the one hand, the industry itself limits the number of samples, and the other hand, we encountered some of the information is incomplete or other samples which do not meet the assumptions or some extreme samples. These samples also resulted in the shrinking of the number.(3) Regression analysis is not comprehensive enough. In addition to analysis of the regression results of hypothesis focuses on a number of variables, this dissertation also found that there is still a correlation between some assisted variables, some even contrary to the traditional perspective. This dissertation has not done more explanation.