Abstract
Abstract In order to improve the information quality of financial accounting reports, this paper puts forward a functional differential equation, establishes the determination model of fair value by mathematical analysis method and studies the correlation of financial accounting information of fair value through this model. The results show that according to the fair value determination model, in the free accounting environment, fair value financial accounting information has an impact.
Highlights
With the continuous development of capital markets, derivatives of continuous innovation, based on the historical cost measurement and the highlighted drawbacks of the accounting information system, fair value accounting becomes a difficult and tough problem at the same time for all accounting boards including the International Accounting Standards Board (IASB), American accounting standards board (FASB) or our country’s accounting standards board
We come to the following conclusions: (1) Based on the functional differential equation, fair value accounting information has value correlation, and at the same time, it has significant explanatory power for the stock price, but this explanatory power varies in different markets
(2) There is a certain correlation between the volatility of the numerical value of the functional differential equation and the fair value accounting information, and it is more significant in the period of market volatility than in the period of stability
Summary
With the continuous development of capital markets, derivatives of continuous innovation, based on the historical cost measurement and the highlighted drawbacks of the accounting information system, fair value accounting becomes a difficult and tough problem at the same time for all accounting boards including the International Accounting Standards Board (IASB), American accounting standards board (FASB) or our country’s accounting standards board. Since the implementation of accounting standards on 1 January 2007, this paper has obtained a certain amount of fair value data information to conduct empirical research on fair value, reflecting whether the application of fair value by Chinese listed companies has improved the quality and value correlation of accounting information, and testing the application effect of fair value in China. When conducting empirical research on fair value correlation, some scholars mostly use the Ohlson model or make some modifications on the basis of the Ohlson model, in order to test the explanatory power of accounting data on stock prices and earnings. After studying the samples of net assets per share, earnings per share and changes per share of financial assets measured at fair value on and off the balance sheet, Xu Hong conducted the research on the full sample
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