| The measurement of fair value was used in a number of specific criteria which was enacted by Ministry of Finance in 2006. The new guidelines have been used for three years. The article not only analyzed the value-relevance of fair value measurement from the theoretical level, but also research on the significant response of China's capital market to the use of fair value from the empirical level. It's very significant for us to use the measurement of fair value better, which can provide exact accounting information to help the related people make useful decisions.The article chose 1233 companies meeting the conditions for the sample data from 1804 listed companies of 13 industries in Shenzhen Stock Exchange and Shanghai Stock Exchange. The sample used annual financial statements in 2007 and 2008 as panel data, and established price model and revenue model based on them. Deferred income tax was first introduced in the set of independent variables, and at the same time control variables were used. Then, the article analyzed the sample through the regression Analysis of fixed effects. The conclusions were that: the measurement of fair value increases the value-relevance in the Balance Sheet, but the value-relevance in the Income Sheet is less relevant.Based on the conclusions, the article proposes the following recommendations: (1) improving accounting standards, strengthening theoretical research of the fair value and developing specific criteria for fair value measurement. (2) creating a fair and efficient market-environment and establishing a fully competitive market, to create a good soil for the fair value of the promotion.(3) developing and improving relevant laws and regulations, to prevent and restrain violations.(4) improving the structure of companies, improving the internal control system and building the protection mechanism of the access to fair value.(5) making the enhancement of professional skills and ethics training ,to enhance professional level of employees. |
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