| Fair valve rises due to the financial economy, while it declines because of the same factor. This embarrassing phenomenon should be paid much attention to and deserves further research. It is just over a year after the formal implementation of fair value accounting that the financial crisis bursts, which almost results in the abolition of the former. On that condition, the study on fair value has theoretical and practical significance.In this paper, the information quality resulted from the loss and gain of changes in fair value is analyzed from information and measurement aspects based on decision usefulness of accounting objectives. The conclusions can be drawn as follows:Firstly, because the current loss and gain of changes in fair value contains the prophase ones which were confirmed before, its purity is influenced, as a result, the quality of the information is reduced. Secondly, profit and loss from fair value changes is short of continuity in terms of time. Attributing loss and gain changes at time point to operating profit a certain time period, will influence explanaation of continuing operating profit toward corporate earnings. Thirdly, the profit and loss from fair value changes is the fair value changes at different time points of the average market rate of return and estimate of cash flows, rather than the reflection of enterprise value of excess return. It does not meet the definition of economic value for the enterprise. Besides, it can not be predicted from growth perspective and does not accord with the implied conditions of ohlson model application, so the profit and loss from fair value changes can improve the demonstration of net profit toward enterprise value.By selecting14listed bands from2007to2010in Shanghai and Shenzhen as samles, the information quality of profit and loss from fair value changes is empirically analyzed through adopting return and price models. The empirical results are consistent with the theoretical analysis ones. |
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