The IFRS9 And The Research Of Expecting Impact On Banking Of China

Since the finance crisis in 2008,the global economy has been suffered and many countries got severe loss around the world.Countries and organizations in the world ran seminars to analyze and explain the reason of this crisis.Seminars in the aspect of Accounting also were held,which found that the range and depth of this crisis were aggravated by the procyclicality of fair value and the financial market transparency and the stability of world’s economy and financial system can benefit from high-quality financial report.So the FSB and G20 appeal that accounting standards setters,especially IASB and FASB,should take steps to reduce the complexity of accounting standards and set a high-quality global accounting standards.IASB responded to the call of FSB and G20 to reform the international financial reporting standards,which announced a project plan that the new IFRS9 would substitute for the IAS39 in the meeting held in May,2009.The substitution project has three main stages:classification and measurement,impairment method and hedging accounting.Stick to the plan,IASB released the exposure draft of first stage-financial instrument:classification and measurement in Jul 14th,2009,second stage--financial instrument:amortized cost and impairment in Nov 15th,2009,and the last about hedging accounting in Dec,2009.Due to the accounting standards of China are on the way to converge the international standards,our standards need to converge IFRS9 with its implement.This research will study on the effect to the banking of China by the relevant regulation of IFRS9 and hope this is useful for the decision of stakeholders.This research use two methods:normative research on standards comparison and case study on annual reports in 2009 and 2010 of four major state banks.This article has the following five parts:The first part is introduction.The background of IFRS9 and the significance to research the effect on banking will be included in this part.Current research results will be described in terms of fair value measurements,empirical study of the fair value and the economic consequences of the fair value.The second part is about evolution of financial instrument of IFRS.The history of IFRS and its council will be introduced.Then the definition and classification of financial instrument will be summarized.At last,the history of financial instrument is the key researching point.The third part is about the effect on banking caused by the change of classification and measurement of the new standards which is the first part of the substitution project.New standards will be compared with IAS39 in classification and measurement part about main modification and characteristic.On the basis of analyzing financial capital and debt of banking of China,the effect of modification will be analyzed from three part of totality,equity instrument measurement and fair value change.The fourth part is about the effect on banking caused by the change of impairment model which is the second part of the substitution project.The theoretical ground of the revolution of impairment model and characteristic of new expected loss model will be analyzed,then the effect by the implement of expected loss model on banking and the rationality of expected loss model selectively.The policies to deal with the new depreciation impairment model will be proposed.The fifth part is about converging to IFRS9 and the latest development.Although on the background of globalization,it is inevitable for the convergence of accounting standards,the position and strategies for China during the period of convergence of accounting standards will come up.Last but not the least,show the latest results of hedging accounting which is the third part of the substitution project.