The Analysis On Earning Management Of Listed Companies’ Under The Fair Value

The fair value is first appeared on "Accounting Standards for Enterprises-Debt Restructurings",which was published in our country in 1998,And was revised many times since our economic market was not well established.The fair value was recognized as an accounting measurement until 2006 when the Chinese Ministry of Finance issued a new "enterprise accounting Standards".The fair value’s reuse is conform to the trend of economic development,and its existence is necessary.However,the fair value measurement can be used to manipulate the retained earnings by some companies,because the market supervision is inadequate.This paper takes real estate listed company as example to explore the fair value and the retained earnings management,in order to understand how to regulate the use of fair value through effective channels.This paper uses case study analysis,and selects real estate listed company VANKE as a sample.Firstly,this paper introduce the fair value concept、measurement methods and the concept、characteristics、motivation of the retained earnings management.Secondly,Detailed analyze the application and the impact of fair value measurement,in the fields of financial instruments、the consolidation under non common control、debt restructurings、the investment real estate、the transaction of non-currency assets.Thirdly,Detailed analyze the financial ratios of VANKE recent years by case study to explain the relationship of the fair value and the retained earnings.Finally,give suggestions of the listed companies the retained earnings on the fair value measurement.For example,strengthen the theory studies to accomplish relevant standards;strengthen supervision to established the healthy the market environment;training the high level staff;accomplish the internal control system of companies to establish the governance and stock structure;accomplish the information disclosure system to establish the information platform.The conclusions of this paper are as follows:(1)the fair value measurement is mainly applicated in the five fields of financial instruments、the consolidation under non common control、debt restructurings、the investment real estate、the transaction of non-currency assets.(2)the application of the fair value measurement in the fields of financial instruments and the consolidation under non common control has apparent impact on the retained earnings management.(3)However,the application of debt restructurings、the investment real estate、the transaction of non-currency assets has little impact on the retained earnings management.(4)we can see VANKE has been using the fair value measurement to manage the retained earnings by analyze the financial ratios of VANK.