Research On The Division Of Financial Liabilities And Equity Instruments

Economic development since the reform and opening up of our country got of the praise, with the rapid development of the real economy, financial markets are more energetic, more and more innovative capital instruments have appeared in the public eye, all kinds of innovative capital instruments launched, to the enterprise how to appropriate accounting classification has brought serious challenges. Since products appear preferred stock, in order to keep pace with the preferred stock is a financial product, the ministry of finance and immediately issued the financial the distinction between debt and equity instruments and related accounting regulations (hereinafter referred to as the regulations), the rules explicitly put forward the issue of preferred stock companies should be how to classification and related accounting treatment, the preferred stock and the advent of popularization has a strong and positive role in promoting. After preferred stock, sustainable debt also immediately boarded the stage of the history of the financial markets:since 2013, minsheng bank, pingan bank respectively, and real estate developer cooperation issued after the product, many other companies in accordance with sustainable bond issuance conditions also followed suit, in the domestic real estate class sustainable debt is on the rise.With the further development of Chinese economy, regulation system are also constantly improve, the innovation of the preferred stock and debt sustainability and similar capital tools will constantly emerging, the emergence of these innovative capital instruments, is bound to be asked to give accurate processing in accounting. So, the regulators, issuers and investors, correct financial liabilities and equity instruments are divided into a serious challenge. First of all, the financial liabilities are measured at fair value and amortized cost, does not confirm the changes in fair value gains and losses, and equity instruments correctly classified financial liabilities and equity instruments for the recognition, measurement, recording and reporting of financial instruments is essential; Secondly, divide financial liabilities and equity instruments correctly, is not only beneficial to determine the net income of the enterprise, but also to financial leverage ratio and other financial indicators of the correct calculation, thus influence enterprise financial goals; Finally, to divide equity instruments and financial liabilities results may effect to the enterprise capital structure, and impact on enterprise’s financing policy and investment decisions, which affect the enterprise financial product release methods and effects of different capital structure influences the enterprise for the best financing combination of decision-making. Therefore, how to accurate and effect equity instruments and financial liabilities division is more important to study.Give priority to in order to standardize research, this paper adopts the method of comparative analysis and case analysis, financial liabilities and equity instruments of the basic concept and the classification standards as the theoretical basis, the accounting recognition to sustainable debt issues to delve into, and supplemented by the typical cases of listed companies, to sustainable debt between equity instruments and financial liabilities such as the definition and classification of related studies the theory and practice, and by the point and the surface will be broaden to relevant accounting practice the analysis of the current overall situation, can hope to improve the related theoretical system and promote accounting norms, in order to enhance the maneuverability of the relevant accounting standards, and make for sustainable debt issuers and investors to research financial tools have a more clear understanding, such as helping them to make more rational investment and financing decisions. The essay mainly discussed from the following five parts.The first part, introduction. On the basis of the selected topic background, research significance of this article, and the existing literature, thus put forward in this paper, research methods and research train of thought, and points out that the innovation of this article points and limitations.The second part, research foundation. Mainly introduces the theory related to this article research content and the change of domestic and foreign relevant accounting standards in the comparison and evaluation, etc.The third part, classification of sustainable debt accounting theory research. Mainly expounds the basic profile of a sustainable debt, debt sustainability characteristics influence on accounting classification, a necessary condition for sustainable debt accounting classifications and sustainable debt accounting treatment under different ownership.The fourth part, the classification of sustainable debt accounting practice analysis. Through two typical cases of listed companies introduce comparative analysis, this paper discusses the division of equity instruments and financial liabilities and its influence, and promote to the accounting practice analysis of the current overall situation.The fifth part, conclusion and revelation. To explore the problems existing in the practice, causes and countermeasures. Illustrates the main point of this article, on the outlook for the future development trend.Writing content both innovation and deficiency of this article:because sustainable debt is new innovative capital instruments in recent years, the current domestic academia to sustainable debt related research mainly concentrated in the financial instruments accounting recognition and measurement of financial instruments properties on such issues, and to the problems of financial liabilities and equity instruments classified study is less, this article not only from the domestic and foreign accounting standards specification for sustainable debt accounting recognition problem carried on the thorough analysis, also lists the typical case analysis and domestic currently issued a sustainable debt thirteen cases of Hong Kong listed companies to carry on the practice of the overall analysis, both particularity and universality, to China’s innovative capital instruments accounting practice has a certain practice guidance. Due to limited capacity, in this paper, the financial liabilities and equity instruments classified accounting norms is not enough comprehensive system, in the domestic sustainable debt issued in Hong Kong listed company, part of the company’s disclosure of sustainable debt issued is not fully transparent, in case part of the argument may not be sufficient enough.