International Accounting
 

Abstracting and Indexing

РИНЦ
Referativny Zhurnal VINITI RAS
Worldcat
Google Scholar

Online available

EBSCOhost
Eastview
Elibrary
Biblioclub

Archiving

Cyberleninka (12 month OA embargo)

Fair value in the Russian accounting practice: The rationale and possibility of measurement

Vol. 22, Iss. 7, JULY 2019

Received: 23 April 2019

Received in revised form: 21 May 2019

Accepted: 13 June 2019

Available online: 15 July 2019

Subject Heading: NATIONAL STANDARDS OF ACCOUNTING AND REPORTING

JEL Classification: М40, М41

Pages: 766–778

https://doi.org/10.24891/ia.22.7.766

Sorokina E.M. Baikal State University, Irkutsk, Russian Federation
soelmi@yandex.ru

https://orcid.org/0000-0002-5802-4238

Makarenko S.A. Baikal State University, Irkutsk, Russian Federation
makarenko_svetla@mail.ru

ORCID id: not available

Subject As the current accounting practices in Russia show, accounting items (lease items, in particular) can be measured at fair value, which still lacks a theoretical underpinning. There is no unambiguous and common understanding of this concept and measurement technique.
Objectives The study reviews the concept of fair value and practical possibilities to calculate it.
Methods We examine, systematize, summarize and analyze the relevant economic literature and regulatory framework.
Results Accounting data become more informative if accounting items are measured at fair value. We also prove it is unreasonable to cease using the actual value for valuation purposes since it preserves the controlling function. The existing technological level of the accounting practice is sufficient to provide users with information on accounting items measured at two types of values (historical cost and fair value). It is not always reasonable, if impossible, to translate the fair value through the market value. In the case of the sluggish or non-existent market, fair value should be calculated as the present value. However, in the case of discounting, it is difficult to determine the acceptable discount rate.
Conclusions and Relevance The findings can help formulate theoretical aspects to guide the measurement at fair value, refine regulatory documents and prevent clerical errors in measuring the fair value of lease items.

Keywords: fair value, market value, discounted value, present value, valuation of assets and liability

References:

  1. Ivanova O.V. [Historical review of concept of fair value]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2012, no. 43, pp. 52–58. URL: Link (In Russ.)
  2. Druzhilovskaya E.S. [Application of fair value in the Russian and international accounting]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2014, no. 17, pp. 2–12. URL: Link (In Russ.)
  3. Ilysheva N.N., Neverova O.S. [Fair value as a method of valuation: The present and the future]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2010, no. 7, pp. 48–52. URL: Link (In Russ.)
  4. Plotnikov V.S., Plotnikova O.V., Shevchuk A.I. [The evolution of the fair value measurement concept]. Bukhgalterskii uchet v byudzhetnykh i nekommercheskikh organizatsiyakh = Accounting in Budgetary and Non-Commercial Organizations, 2015, no. 20, pp. 38–41. URL: Link (In Russ.)
  5. Polenova S.N. [A fair value measurement of accounting objects]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2015, no. 1, pp. 2–11. URL: Link (In Russ.)
  6. Rozhnova O.V. [Topical issues of assessment at fair value of assets and obligations]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2013, no. 23, pp. 2–7. URL: Link (In Russ.)
  7. Sokolov V.Ya., Sokolov Ya.V. [International standards and us]. Yurist i bukhgalter = Legal Attorney and Accountant, 2001, no. 6, pp. 6–8. (In Russ.)
  8. Laux C., Leuz C. Did Fair-Value Accounting Contribute to the Financial Crisis? Journal of Economic Perspectives, 2010, vol. 24, no. 1, pp. 93–118. URL: Link
  9. Lee Charles M.C. Performance Measurement: An Investor's Perspective. Accounting and Business Research, 2014, vol. 44, iss. 4, pp. 383–406. URL: Link
  10. Fawzi A. Al Sawalqa. Fair Value Accounting: A Controversial but Promising System. Accounting and Finance Research, 2016, vol. 5, no. 1, pp. 88–98. URL: Link
  11. Magnan M., Menini A., Parbonetti A. Fair Value Accounting: Information or Confusion for Financial Markets? Review of Accounting Studies, 2015, vol. 20, no. 1, pp. 559–591. URL: Link
  12. Sorokina E.M., Makarenko S.A. [An organization's assets valuation at fair value]. Izvestiya Irkutskoi gosudarstvennoi ekonomicheskoi akademii = Bulletin of Baikal State University, 2004, no. 4, pp. 17–21. URL: Link (In Russ.)
  13. Kuvaldina T.B., Lapin D.R. [Theory and practice of applying the current market value in measuring corporate assets]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2015, no. 20, pp. 2–15. URL: Link (In Russ.)
  14. Kulikova L.I., Stepanov K.A. [Present value: Appraisal of assets and liabilities]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2009, no. 10, pp. 26–32. URL: Link (In Russ.)
  15. Kuvaldina T.B., Lapin D.R. [Theoretical and practical issues of using the present value in accounting and reporting]. Mezhdunarodnyi bukhgalterskii uchet = International Accounting, 2015, no. 10, pp. 2–13. URL: Link (In Russ.)
  16. Efimova O.V. [Present value: Calculation and analysis]. Bukhgalterskii uchet = Accounting, 1998, no. 10, pp. 97–102. (In Russ.)
  17. Chikhirnikov A.M. [Determining the discount rate by cumulative construction]. Azimut nauchnykh issledovanii: ekonomika i upravlenie = ASR: Economics and Management, 2015, no. 3, pp. 86–90. URL: Link (In Russ.)

View all articles of issue

 

ISSN 2311-9381 (Online)
ISSN 2073-5081 (Print)

Journal current issue

Vol. 22, Iss. 8
August 2019

Archive