Applied Research On Measurement Model Of Investment Property

In recent years, with economic development and investment concept change, it is verypopular to use real estate as an investment. This investment behavior is to be considered thenew point of economic growth by many companies. For high-risk and high-yieldinvestment real estate, and to meet the requirement of market economy in China, Ministryof finance promulgated Accounting Standard for Business Enterprise No.3Investment RealEstate on Feb.15.2006. According to the NO.3provisions of ASBE, there are two types offollow-up measurement model for enterprise investment real estate, namely, costmeasurement and fair value measurement. From the decision-making relevant view, fairvalue measurement can better react to the market value and profitability of investment realestate projects, and improve accounting information quality. It also provides more relevantaccounting information for financial statement users to make proper economic decisionsand exactly evaluate development of enterprises. At the beginning of ASBE promulgation,many experts and scholars forecasted that fair value measurement would be very popularwith enterprises. Howerver, for six years implementation, only a very few enterprisesadopted the fair value measurement model. How does the situation form? What are thefactors for enterprises to select measurement models? How to promote the application offair value measurement? All these issues have been the joint research subjects in the worldof accounting theory and practice. That is the pointcut and research purpose of this article.By the means of qualitative analysis and economic analysis, firstly introduces the topicselection background, research purpose and methods, and also review the overseas anddomestic research status. The second part discusses the relate thoeries of investment realestate measurement models. The third part does statistical analysis for the application statusof investment real estate measurement models. In this part, it generally describes all publicdisclosure information from the listed companies which own investment real estate, andstates the application situation of investment real estate measurement models. And on thatbasis it analyzes how the investment real estate measurement models application impactedon listed companies, by combining the theory with the historical empirical data. Finally,from the two aspects of management motivation and economic consequences of fair value,it analyzes the reason that many enterprises prefer cost measurement rather than fair valuemeasurement to measure investment real estate. Meanwhile, it proposes the suggestion toimprove health application of fair value measurement standard, so as to offer reference tosteadily promote fair value.