Market Reaction To The Changes In The Fair Value Of Financial Assets

Its relevance and reliability have been widely disputed by society since fair value as an accounting measurement attribute.Especially in the economic crisis of 2008,it almost made the measurement attribute of fair value out of the stage of history.Fortunately,a large number of scholars have carried out a series of empirical tests on the measurement attributes of fair value,which proves that fair value can provide more reliable financial information.Fair value measurement only uses terms to reflect the situation of social and economic operations.Once the highly relevant fair value measurement attribute is cancelled,it will inevitably conceal the real reasons for the lack of liquidity and failure of financial institutions,and will only have a more adverse impact on economic development.With the argumentation and practical experience of scholars,the measurement attribute of fair value was gradually affirmed by the accounting and financial circles.On March 31,2017,in order to meet the needs of China's market economy development,the Ministry of Finance regulated the accounting treatment of financial instruments and improved the quality of accounting information.The Accounting Standards for Enterprises No.22-Recognition and Measurement of Financial Instruments and Enterprise Accounting Standards were issued and issued.No.23-Transfer of Financial Assets and Enterprise Accounting Standard No.24-Hedging Accounting,on May 2 of the same year,revised and issued the "Accounting Standard for Business Enterprises No.37-Presentation of Financial Instruments".China's capital market is relatively late,and its market specifications are not perfect.Many assets do not have an active market.The valuation technology is relatively backward and the market participation is low.These factors will lead to fair value measurement.The market reaction generated in our country may be different from that of Western countries.Therefore,this paper examines the market reaction caused by changes in the fair value of financial assets of non-financial companies based on differences in the presentation of changes in the fair value of financial assets.From the perspective of market reaction,our country's accounting standards should follow the actual situation of China's economic market in the process of following international accounting standards and provide empirical evidence for better application of financial instruments in China.This article collects the literature on fair value correlation studies,the literature on fair value economic consequences research,and the literature on the study of fair value market presentation reactions,and draws the research direction of this article: different presentation methods of changes in the fair value of financial assets will lead to market What kind of reaction,from the perspective of market reaction,study the practical application of the guidelines.Through the hypothesis of effective market hypothesis,function locking hypothesis and procyclical effect theory,this paper puts forward the assumptions of this paper and uses the event research method to empirically study the A-share data of non-financial industries from the 2007 to 2016 Shanghai Stock Exchange.After China introduces the concept of comprehensive income,the changes in the fair value of financial assets in the statements in different positions will cause different reactions in the market.When changes in fair value are reported in the income statement,it will cause excessive reaction in the stock market.When the change in fair value was reported in the statement of changes in owners' equity,the stock market did not respond adequately.When the change in fair value is reported in both the income statement and the statement of changes in owners' equity,the stock market reacts to it fully.According to the conclusions of this paper,the paper proposes that the company should disclose information comprehensively when publicizing information to make the information transparent and open;investors should avoid the existence of function locking behavior when making investment decisions;investors should benefit from comprehensive income.Focus on the company's business activities,assess the company's operating performance.