The Financial Impact Of The New Revenue Standards On Real Estate Enterprises

In order to maintain the convergence with international accounting standards,the Ministry of Finance revised and issued the new revenue standards in 2017.Compared with the previous revenue standards,the new revenue standards have made important modifications and improvements in many contents,such as changes in the point of revenue recognition.The guidelines have just been fully implemented,and more problems may be found in the actual implementation.Real estate industry is one of the foundation of developing national economy and improve people’s life,and income is the main source of profit,due to the pre-sale period of the special sales model,the real estate industry income is more complex than other industries,so,this paper selects the new income criteria on the financial impact of real estate enterprises for the topic,to help real estate enterprises to timely response,promote the sustainable development of accounting practice.This paper first reviews the literature on changes in income guidelines and their impact on the real estate industry,and then analyzes the "five-step" model of the new guidelines and changes compared to previous standards.Based on this paper introduces the relevant situation of the real estate industry and the impact of the new guidelines.Then,taking Vanke Group as an example,it introduces its general situation,and discusses the financial impact brought by the new standards for Vanke from the perspective of accounting,financial statements,financial indicators,information quality and enterprise management.The case study found that the new guidelines had a positive impact on the financial information of real estate companies compared with previous guidelines.The specific impact mechanism is as follows: the new revenue criteria affects the revenue recognition measurement method of the real estate company;secondly,this change leads to the change of financial information,such as the financial statements and financial ratio of the company;the addition of "contract assets" and "contract liabilities" makes assets and liabilities more close to the reality,timely carry forward costs,confirm revenue,make profit and cash flow more match,but also brings greater challenges to the operation and management of the enterprise,including contract system,information system and fiscal and tax management.Finally,this paper proposes countermeasures for real estate enterprises to better respond to the impact of the new standards,including strengthening contract management,upgrading information systems,promoting business and financial integration,and improving tax management,so that companies can improve their financial situation more effectively.