The Initial Recognition And Measurement Of Valuation Adjustment Mechanism For Equity Investment Company

Today, VAM is the current business investment and financing agreement of the main way because of its own unique properties, in recent years, equity investment practice in the common performance control means, but in the accounting treatment, due to the lack of relevant clear provisions,the introduction of domestic and the practice is not yet sufficient.The norms of accounting standards in this field are only the principle, so far in the theoretical understanding and the specific application of the guidelines still have objections,need to study and further refinement and improvement.In the accounting treatment of VAM, the most critical step is the initial confirmation and measurement of VAM, only a more fair manner to the initial recognition and measurement of VAM in order to accurately carry out the accounting agreement on VAM. At present, the accounting treatment of VAM is mainly carried out according to the relevant relevant Accounting Standards for Business Enterprises and the relevant accounting regulations. In 2014, the Ministry of Finance carried out a wide range of amendments to the Accounting Standards for Business Enterprises, including the Accounting Standards for Business Enterprises - Financial Instruments Confirmation and Measurement "and” Accounting Standards for Business Enterprises No. 37 - Financial Instruments", the relevant provisions of the guidelines were revised and added or deleted. Subsequently, the Ministry of Finance issued the Notice on Printing and Distributing the Provisions on the Discrimination of Financial Liabilities and Equity Instruments and the Accounting Treatment Provisions(Accounting [2014] No. 13), which stipulated the classification and accounting treatment of financial instruments, but the lack of provisions Specific provisions for accounting treatment of gambling agreements.In view of the above situation, in order to further improve the accounting rules of enterprises to deal with gambling agreements to enhance the quality of accounting information on the accounting agreement, the author combined with China's current accounting rules and accounting standards related to the accounting agreement, analysis of China's accounting In the specification, the existing problems of the initial recognition and measurement of VAM against the investors in the accounting regulations of VAM are tentatively proposed, and the relevant suggestions on improving the accounting standard of VAM are put forward.This paper argues that there are three main points in the accounting standards of financial instruments accounting for the accounting treatment of VAM. One is that according to the current standard, it can not be clearly judged that the business management behavior, such as management retention, The second is due to the current accounting standards do not make a detailed definition of financial variables, resulting in can not accurately determine whether VAM can be recognized as derivative financial instruments; the third is the lack of on VAM as a derivative financial instruments And the main contract for the separation of the provisions of the separation. There are two main points about the accounting treatment of the investor's accounting agreement. One is that the relevant guidelines of the option pricing in the accounting standards are more principled and the pricing of the options in the practice is very large Of the subjectivity and arbitrariness, and if you can not reasonably priced, the reliability and relevance of follow-up accounting treatment is difficult to guarantee; the second is the lack of existing accounting standards on the initial recognition of the investment agreement should be recognized as asset class Financial instruments or liabilities of the provisions of the financial instruments, making the practice of investors in the initial recognition of VAM to bring greater differences. The shortcomings of the relevant provisions on the classification of investment gambling insurers are that the criteria stipulate that the accounting standards are to be determined by judging the identity of the subject, but the definitive definition and identification conditions are not given for the judgment of the subject identity; On the other hand, the non-venture capital institutions in accordance with the venture capital institutions under the mode of operation of the use of what criteria and basis for judgments, and how to deal with the lack of detailed provisions. In addition, the other party to the agreement is the controlling shareholder of the listed company, the lack of accounting standards and other accounting standards, and did not use the accounting practice case guidelines to clarify the accounting principles of such special matters.In view of the above shortcomings, this paper attempts to put forward the relevant improvement, supplement, improve and refine the accounting standards and the first provisions of the proposed recommendations to China's investment enterprises on the accounting agreement to further improve the design to provide a useful reference.