Correlation Study Of CFO Characteristics And Fair Value Measurements

The Business Accounting Standards NO.39—fair value measurement has been implemented since July 1,2014 in our country.It is the further specification of the fair value measurement after the fair value was re-introduced by the Business Accounting Standards in 2006.The Fair value measurement has been applied in various accounting standards in China,but there are still some problems in the specific application process.It is affected by many factors,including the external environment of enterprises,their own situation,the standards themselves and the executors of the standards.CFO as the business manager have the decision-making power.So the application of the fair value measurements is affected by the CFO.According to the top management theory,the company performance is affected by the managements’characteristics.The application of fair value measurement will also be affected by the CFO personal characteristics.In this paper,we first make a review of CFO personal characteristics and the fair value measurement at home and abroad.Through the study of many scholars,we find that CFO personal characteristics affect the accounting information quality and business achievements and so on.The application of fair value measurement is affected by many factors.At the same time,the paper defines the meaning of CFO personal characteristics and the fair value measurement and fair value valuation techniques.Hereafter,we analysis CFO personal characteristics such as gender and age affect the fair value measurement model selection and fair value valuation techniques selection combining management defense hypothesis,stakeholder theory and incentive theory.Then,In order to test the correlation of CFO personal characteristics and fair value measurement,the paper analysis the information of 51 companies measuring the investment real properties with the fair value measurement model and 55 companies measuring the investment real properties with the cost model which were selected from Shenzhen and Shanghai A-share listed companies in 2015 by descriptive statistics and logical regression methods.The paper test the correlation of CFO personal characteristics and fair value valuation techniques using 43 companies which disclosured the fair value valuation techniques in annual report of 2015 from 51 companies measuring the investment real properties with the fair value measurement model.We find that CFOs’ gender,education and term of office affect the selection of fair value measurement model.The gender and education also affect he selection of fair value valuation techniques.At last,according related theory and the results of empirical analysis,we put forward some suggestions including improving the fair value measurement standards,fair value measurement specification,considering CFO personal characteristics when companies engage CFO.At the same time,related departments should strengthen the supervision over the disclosure of corporate financial reports including fair value valuation techniques and CFO personal characteristics.CFO should pay attention to improying their professional quality and comprehensive ability.In order to obtain reliable fair value easily,we should establish a sound evaluation system and improve the ability of assessors.