scholarly journals Accounting measurement at fair value in the conditions of financial crisis

2021 ◽  
pp. 275-287
Author(s):  
Vladimir Obradovic ◽  
Nemanja Karapavlovic
Keyword(s):  
Financial Crisis ◽  
Credit Rating ◽  
Global Financial Crisis ◽  
Relevant Literature ◽  
Professional Community ◽  
Fair Value ◽  
Risky Behaviour ◽  
Accounting Measurement ◽  
The Impact

The subject of the paper is the role of fair value, as one of the accounting measurement attributes (measurement basis) of assets and liabilities in the statement of financial position, in the conditions of crisis, based on the experience with global financial crisis which appeared in 2008 in the US financial sector, and later spilled over into the real sector of that country, as well as, to a greater or lesser extent, to the rest of the world. The crisis has stimulated discussions in the scientific and professional community about the usefulness of using fair value and the impact of this measurement attribute on the appearance and widening of the crisis. The aim of the paper is to consider the impact of fair value application on the occurrence of the mentioned financial crisis. Qualitative research methodology based on the review of relevant literature in the field of research subject has been applied. A review of literature available to us has shown that there is no unique attitude about the role of fair value in the financial crisis which appeared in 2008. In that sense, opinions range from the one that fair value played little or no role in the financial crisis, over the opinion that it may have contributed to the acceleration of the crisis, to the opinion that it was one of its main causes and that it should be suspended. It is certain that fair value cannot be declared as the only financial crisis causer, and that there is no only one causer. Inadequate banking practices, risky behaviour of financial markets participants, inconsistent and insufficiently coordinated macroeconomic policies, inadequate structural reforms and omission of credit rating agencies dominantly caused the financial crisis and contributed to its spread.

AN EMPIRICAL STUDY OF INDIAN INSURANCE INDUSTRY POST GLOBAL FINANCIAL CRISIS

2015 ◽  
Vol 6 (01-02) ◽  
Author(s):  
Anis Ur Rehman ◽  
Yasir Arafat Elahi ◽  
Sushma .
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Insurance Industry ◽  
Primary Data ◽  
Policy Recommendations ◽  
Insurance Sector ◽  
The World ◽  
The Impact ◽  
The New Deal

India has recently emerged as a major political and economic power in the world. The financial crisis that engulfed the world in 2008 needed developing countries like India to lead the rescue and recovery, instead of G7 westerns countries who dealt with such crisis in the past. Recently, discussions and negotiations are going amongst G20 countries regarding a new global financial architecture (G-20 Summit, 2008). The outcome will affect the relevant industries in India and hence it is a public interest issue for the actuarial profession in the country. Increased and more intrusive and costly regulations and red tapes are likely to be a part of the new deal (Economic Survey 2009-10). The objective of this paper is to study the perception of higher level authorities in Insurance sector regarding the role of regulator in minimizing the impact of global financial crisis. The primary data has been collected from 200 authorities in insurance industry. The data has been analyzed with statistical tools like MS-Excel. On the basis of the findings, various measures and policy recommendations for insurers have been suggested to minimize the impact of crisis.

Role of Accounting and Audit in the Recent Financial Crisis

2013 ◽  
pp. 91-98
Author(s):  
Alev Dilek Aydin
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Fair Value ◽  
Financial Reports ◽  
Historical Cost ◽  
The Public ◽  
Creative Accounting ◽  
Recent Financial Crisis ◽  
Audit Reports

This study aims to assess the role of accounting and auditing in the recent financial crisis. After each crisis, there have been serious discussions concerning the reasons behind those crises. However, no consensus has yet been achieved until now. In this context, the analysis of the relationships among financial crisis, accounting, and auditing is of utmost importance in better evaluating the structural reasons behind the crisis. There are several points that this chapter aims to analyze to indicate the contributions of accounting and auditing to the recent global financial crisis. These points are: impacts of disregarding the main principles of accounting, the wide use of fair value accounting over cost-based accounting, incorrect and misleading financial and audit reports, applications of creative accounting, and lack of transparency and weaknesses of the auditing process. The debates generally concentrate on the use of fair value (mark-to-market) accounting in the financial reports as opposed to the historical cost method. It should be emphasized that accounting is very important as a key mechanism of market economies, because of its crucial role in the functioning of the markets in accordance with the public interest. The chapter concludes with several suggestions by taking the fact into consideration that accounting and auditing systems should be revised for the better protection of interests of the third parties such as investors, potential investors, and the state.

The impact of the global financial crisis on Millennium Development Goal attainment in Africa

2017 ◽  
Author(s):  
Leah McMillan Polonenko
Keyword(s):  
Financial Crisis ◽  
Goal Attainment ◽  
Global Financial Crisis ◽  
Adequate Funding ◽  
Development Goals ◽  
Education In Ghana ◽  
The Global Financial Crisis ◽  
The Impact ◽  
Global Initiatives

This chapter examines the challenges involved in attaining the Millennium Development Goals (MDGs) in Africa in the wake of the 2008 global financial crisis and highlights important lessons for future financing of global initiatives. The 2008 global financial crisis provided a very important caution: global initiatives are only as good as their global conditions. The crisis had very real consequences for the education sector, particularly through the reduction of adequate funding. The chapter first considers the consequences of the global financial crisis to education, taking into account the role of foreign aid, before discussing the cases of primary education in Ghana and Zimbabwe. It concludes by suggesting some best practices for learning from the failures to education from the 2008 agenda.

Fair value accounting and the financial crisis: a literature-based analysis

2016 ◽  
Vol 14 (1) ◽  
pp. 49-71 ◽  
Author(s):  
Elisa Menicucci ◽  
Guido Paolucci
Keyword(s):  
Financial Crisis ◽  
Literature Review ◽  
Empirical Studies ◽  
Relevant Literature ◽  
Fair Value ◽  
Research Literature ◽  
Fair Value Accounting ◽  
Comprehensive Overview ◽  
Content Type

Purpose The aim of this paper is to review the main results of accounting research literature examining the role of fair value accounting (FVA) within financial crisis. This research analyzes theoretical and empirical studies on the controversial topic about FVA and its alleged pro-cyclicality in the context of the financial crisis to offer solid reflections for improving the fair value research agenda. Design/methodology/approach This paper consists of a descriptive literature review. Theoretical and empirical research studies were investigated and then systematized in a framework to guide a literature-based analysis and critique of the relevant literature published about this topic. Findings The review reveals that there has been only a limited amount of research into the role of FVA within the financial crisis. This topic has not been researched extensively, and there is no empirical evidence that FVA caused the financial crunch and the subsequent financial crisis. Research limitations/implications The restricted amount of literature that directly deals with FVA in the context of the financial crisis is the main limitation of this paper. The specificity of the theme narrows the coverage. However, the adopted research methodology enabled the main contributions concerning this issue to be collected, to realize a concise and comprehensive portrait of the debate surrounding FVA and the financial crisis. Practical implications This paper can be of use to both researchers and practitioners interested in investigating strengths and weaknesses of the fair value concept for accounting purposes. The paper sets out the main findings of the academic literature and identifies future avenues of theoretical and practical research which may support standard setters to draw up improved accounting regulation. Originality/value Few existing studies consist of a literature review that examines theoretical and empirical researches on the influence of FVA on the financial system. This review offers a comprehensive overview on research literature concerning the responsibility of FVA in causing the financial crisis. The main contribution of this paper relates to further understanding the role and effects of accounting matters concerning fair value in a broad sense within the context of the financial crisis.

scholarly journals Economic Resilience: What Role for Policies?

2016 ◽  
Vol 07 (02) ◽  
pp. 1650009 ◽  
Author(s):  
Aida Caldera Sánchez ◽  
Morten Rasmussen ◽  
Oliver Röhn
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Economic Resilience ◽  
Trade Offs ◽  
Shock Impact ◽  
The Global Financial Crisis ◽  
The Impact

The global financial crisis highlighted the importance of strengthening the resilience of our economies to adverse shocks. In this paper, we take stock of studies carried out primarily within, but also outside the OECD, to better understand the role of macroeconomic and structural policies in spurring or mitigating the vulnerabilities that can lead to costly shocks, as well as the role of policies in mitigating the shock impact and speeding the recovery. Then we offer tentative insights on how policies can be geared to address vulnerabilities early on, mitigate the impact of shocks and speed recoveries, as well as highlight possible trade-offs that exist across policy areas.

Impact of Microfinance on Poverty in the Context of Global Financial Crisis

2019 ◽  
pp. 1317-1333
Author(s):  
Arindam Laha
Keyword(s):  
Regression Analysis ◽  
Financial Crisis ◽  
South Asia ◽  
Global Financial Crisis ◽  
Poor Households ◽  
Head Count ◽  
The Global Financial Crisis ◽  
The Impact ◽  
The Relationship

The microfinance programme in the South Asia region has proven to be resilient to the shocks of global financial crisis. In fact, cross country experiences in South Asia reveal little impact of the global financial crisis on the penetration of the microfinance programmes to poor households. To explore the impact of microfinance on poverty in the backdrop of global financial crisis, an attempt has been made in this present study to examine the relationship between MFI's gross portfolio per active borrower and the measures of poverty. Empirical evidences based on Pooled Regression Analysis suggest that gross portfolio per active borrower is negatively and significantly associated with the poverty head count ratio or poverty gap measure, which is consistent with the author's hypothesis that micro loans reduce poverty. The poverty alleviation role of microfinance in South Asian countries is not changing its dynamics even in post-crisis scenario.

Impact of Microfinance on Poverty in the Context of Global Financial Crisis

2015 ◽  
pp. 399-415 ◽  
Author(s):  
Arindam Laha
Keyword(s):  
Regression Analysis ◽  
Financial Crisis ◽  
South Asia ◽  
Global Financial Crisis ◽  
Poor Households ◽  
Head Count ◽  
The Global Financial Crisis ◽  
The Impact ◽  
The Relationship

The microfinance programme in the South Asia region has proven to be resilient to the shocks of global financial crisis. In fact, cross country experiences in South Asia reveal little impact of the global financial crisis on the penetration of the microfinance programmes to poor households. To explore the impact of microfinance on poverty in the backdrop of global financial crisis, an attempt has been made in this present study to examine the relationship between MFI's gross portfolio per active borrower and the measures of poverty. Empirical evidences based on Pooled Regression Analysis suggest that gross portfolio per active borrower is negatively and significantly associated with the poverty head count ratio or poverty gap measure, which is consistent with the author's hypothesis that micro loans reduce poverty. The poverty alleviation role of microfinance in South Asian countries is not changing its dynamics even in post-crisis scenario.

Role of Accounting and Audit in the Recent Financial Crisis

2013 ◽  
pp. 1496-1503
Author(s):  
Alev Dilek Aydin
Keyword(s):  
Financial Crisis ◽  
Global Financial Crisis ◽  
Fair Value ◽  
Financial Reports ◽  
Historical Cost ◽  
The Public ◽  
Creative Accounting ◽  
Recent Financial Crisis ◽  
Audit Reports

This study aims to assess the role of accounting and auditing in the recent financial crisis. After each crisis, there have been serious discussions concerning the reasons behind those crises. However, no consensus has yet been achieved until now. In this context, the analysis of the relationships among financial crisis, accounting, and auditing is of utmost importance in better evaluating the structural reasons behind the crisis. There are several points that this chapter aims to analyze to indicate the contributions of accounting and auditing to the recent global financial crisis. These points are: impacts of disregarding the main principles of accounting, the wide use of fair value accounting over cost-based accounting, incorrect and misleading financial and audit reports, applications of creative accounting, and lack of transparency and weaknesses of the auditing process. The debates generally concentrate on the use of fair value (mark-to-market) accounting in the financial reports as opposed to the historical cost method. It should be emphasized that accounting is very important as a key mechanism of market economies, because of its crucial role in the functioning of the markets in accordance with the public interest. The chapter concludes with several suggestions by taking the fact into consideration that accounting and auditing systems should be revised for the better protection of interests of the third parties such as investors, potential investors, and the state.

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