An Empirical Study Of The Effect Of Fair Value Measurement On The Prediction Of Analysts

The fair value was introduced into CAS as early as in 1998.Due to the imperfect market environment and regulatory system,the fair value was misused by the company for profit manipulation.And then it was abolished in 2010.The biggest highlight of the 2006 CAS was the FV reintroduction.In the fair value measurement model,CAS39-Fair Value Guidelines was implemented starting from July 1,2014,and a series of changes in the new standards has caused extensive discussion in the academic community.This article based on current economic institutional environment of China,combing the relevant literature of fair value,hierarchy information,analyst forecast error and degree of discrete,and building a theoretical framework for fair value and earning forecast of analyst.Selected 2010-2016 as a research sample to examine the impact of fair value information on analyst forecast from the Angle of information asymmetry:first,on the base of control the company characteristics and external factors related variables,And building a test model of the relationship between fair value and analyst forecast quality on this basis.For the purpose of examining the relationship between fair value and analyst forecast quality at the overall level;second,the sample are divided into two levels of information asymmetry to verify the fair value's transmission process to analysts' forecasts,and the three levels of fair value disclosed in the report are used as independent variables to construct an inspection model with the accuracy of analysts' forecasts for the purpose of confirming the different impaction of input values at different levels of fair value on the accuracy of analyst forecasts.The results of the study indicate that(1)the use of fair value improves the accuracy of analyst forecasts,reduces the degree of discrete in the overall forecast,and the higher the degree of fair value use,the greater the role played;(2)The fair value improves the accuracy of analyst forecasts by reducing the degree of information asymmetry,the higher the degree of information asymmetry,the greater the role of fair value play;(3)due to different levels of hierarchical information classification,the first level of fair value information is more relevant and reliable,and plays a major role in improving the accuracy of analyst forecasts.