An Empirical Study On The Effect Of Fair Value

An earlier definition of fair value can be found in Kohler’s Accounting Dictionary in the 1950 s,with the following definitions: "Prices that are acceptable to both parties with sufficient sources of information,and if so,For the estimated fairness of the fair market to accept the price." After the United States Accounting Principles Board(APB)and the United States Financial Accounting Standards Board(FASB)are on the definition of fair value,have stressed the similar point of view,this time the formation of the fair value of the prototype,with the fair value of the development and expansion,The economic consequences of the fair value of the controversy and discussion has been very intense,and this controversy in August 2007 by the US subprime mortgage crisis triggered by the financial crisis peaked on behalf of different stakeholders around the fair value measurement The debate is the focus of fair value measurement is a pro-cyclical effect,the consequences of whether the financial crisis is the culprit.Representatives of the financial sector and regulators believe that fair value accounting has a strong pro-cyclical effect,contributed to the financial system bubble,a direct result of this rare financial crisis of a century,and investors and securities practitioners believe that The use of fair value measurement improves the quality,transparency and effectiveness of accounting information,and helps stakeholders to understand the real situation of financial assets and enhance the flexibility of the financial system.The use of fair value itself is not only The cyclical effect is not the source of financial risk,but can help to promote the positive development of the financial system.This issue of fair value pro-cyclical effects exposed in the financial crisis has pushed fair value accounting to the point of argument and tested whether it has pro-cyclical effects in order to eliminate or mitigate its pro-cyclical effects and to improve fair-value accounting standards,How to use the fair value under the market inactive condition,how to determine the impairment of the financial assets and information disclosure have become the direction of the change of the fair value accounting.As China’s accounting standards and international standards to further convergence of the background,"Enterprise Accounting Standards No.39-Fair Value Measurement" by the Ministry of Finance officially released since July 1,2014 formally implemented.39,the rules of fair value measurement,which were previously scattered among the various criteria,are combined into a complete system,which is also the first time that the measurement attributes are listed as the first criterion alone,indicating that the fair value problem has caused enough And the attempt of accounting standard-setter to solve the fair value measurement dispute.Based on this historical background,this paper,based on the research of other scholars,attempts to analyze the fair value procyclical effect through quantitative analysis and empirical research,the main fair value measurement using a wide range of listed banks as a sample for fair value accounting And then through the analysis and validation of the empirical data of China’s listed banks,the results show that the fair value of the listed banking system in China has a pro-cyclical effect,while also found that the implementation of the 39 criteria The fair value of the pro-cyclical effect,and finally to the development of fair value measurement and mitigation of its pro-cyclical effects,as well as the development direction of accounting standards to make recommendations.