The Financial Consequences Of An Investment Property Accounting Measurement Mode Change

The new accounting rules, companies can independently choose to invest in real estate subsequent measurement mode between the cost model and fair value model. Since 2006, China’s real estate has experienced several years of rapid development, the prosperity of the real estate market to promote real estate prices continue to increase, far more than its historical cost. Accordingly, fair value can not only be more truly reflect the economic substance of value and investment property, and it is a big leap in the way of convergence of accounting standards and international accounting standards on.In this paper, there are case studies of both theoretical analysis of investment property fair value was more in-depth research to theoretical fair value and changes in accounting policies based on the theory, depth of investment real estate shares Guanfu follow-on study changes measurement mode.In this paper, based on research at home and abroad and the fair value of investment property, based on the fair value of investment property and for the study, with shares Guanfu case, change their investment property measurement model for further analysis. Firstly, the financial consequences of the shares Guanfu investment properties measured mode after the change analysis. From net profit, asset-liability ratio, ROE, stock prices, income tax expenses five analyzes the financial consequences of the measurement mode after the change; Second, in terms of motivation to change the measurement mode, to avoid delisting from the institutional environment, market environment, financing needs and other aspects of in-depth analysis; again, in terms of regulation, the real estate market and corporate profit fluctuation analysis of shares Guanfu investment property measured using the fair value model existing problems. Finally, on the optimization of investment property measurement model policy recommendations, in terms of building market environment of fair value, valuation techniques, monitoring mechanisms, and other relevant laws and regulations we need to constantly improve.Guanfu shares by the case studies, the relevant data in-depth analysis, draw, after shares Guanfu metering mode change allows the company to profitability and reduce the debt ratio, improve the return on net assets of enterprises rate, stock prices stabilized, the adverse consequences of increased corporate income tax expense. Therefore, one hand, enterprises should be cautious of changes in accounting policies, on the other hand should increase corporate profits in the main business income.