Application of fair value in financial accounting

Fair value is a value evaluation manner relying on professional judgment accounting personnel. It has played an important role in the process of current generation of accounting information.Among the thirty-eight specific projects in the new accounting standards, there are seventeen items more or less related to the fair value concept. Its measurement attribute has obvious positive effect on modern accounting and financial information reflection. In actual economic activities, fair value concept has been widely used in assessment of real estate value, estimation of financial assets and liabilities, value calculation in enterprise split or reconstruction. Although fair value is a double-edged sword, its promotion for China’s financial assessment should not be underestimated [1]. The flexibility of financial accounting and the strict control of accounting standards, guarantee fair value to be skillfully applied for daily economic activities. Thus, modern enterprise financial management can be achieved. Active market, public information platform, and barrier-free communication of enterprise, raise the requirements of enterprise financial accounting. Financial accountant should be a trimmer and conveyor of information. In addition, he should understand certain common sense, data sources, and change reasons about business operation, so as to provide enterprise with more reasonable reference information, data and operation suggestions.