Abstract：The primary qualities of accounting information are relevance and reliability, the two criteria to enhance the usefulness of financial report. Fair Value Accounting (FVA), thus, fair value measurements have placed greater function in financial statements because this information is perceived as more relevant to investors and creditors than historical cost information. However, the difficult question for implementing FVA is the reliability of fair-value estimates. reliability concerns are particularly serious for instruments that are not market traded, since the management is the one that evaluate them. Malaysia has adopted fRS 139 financial instruments – Recognition and Measurements in the progress of these arguments.
Key words: relevance, reliability, fair value measurements.
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For many-many years, companies have firmly established the practice of “closing” company ledgers each year and producing annual balance sheets and income statements according to accounting periodicity. In conventional accounting, accountants learn the concept of historical cost accounting, the traditional system that based on double-entry book-keeping and reporting transactions at the amount paid or liable. Accountants only recognized gains and losses when actually realized. The matching principle underlies the histo论文范文http://www.chuibin.com/ rical cost method, where expenses are offset against the revenues they support. This strong accounting principle held the faith of 1accountants for decades. today, investors, financial analysts, shareholders, creditors, employees, and communities, nevertheless, believe that historical cost financial statements have lost their value relevance and a good way out may be Fair Vale Accounting (FVA),
2. fair Value
The purpose of financial statements is to report useful information to the users. but how greatly is the basic usefulness of the financial statements can move with the rapid growth of a dynamic economy? For how long the users of corporate financial information have to wait for the accounting standards to completely emerge with a good fair value assessment to evaluate the performance or the creditworthiness of a company? 2496
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