VALUE ALLOCATION – CONTRIBUTION AND RISK TO THE RELIABILITY OF FINANCIAL REPORTING

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dc.contributor.authorDeaconu, Adela
dc.contributor.authorCrisan, Sorana
dc.contributor.authorBuiga, Anuta
dc.contributor.otherEkonomická fakultacs
dc.date.accessioned2022-07-29T07:54:24Z
dc.date.available2022-07-29T07:54:24Z
dc.description.abstractOur study argues in favor of the reliability of fair value estimates for correct decision making by the stakeholders of the fi nancial reporting market. The analysis is singularized to emergent contexts, as the Romanian market is the case study, and it is focused on the process of value allocation between the components of a group of assets. Having an application on fi xed assets, the paper shows how fair value estimation is critical and implies risks on such an atypical market. The process of value allocation may bring a high level of arbitrariness to fair value accounting, this being crucial to apply correctly the valuation methodology in relation to the nature of the asset and market information available, and the selection of the allocation keys. The empirics of our study show a consistent expertise of Romanian valuators, as the most frequently used method for value allocation is the deduction of the value of those assets that was estimated based on the market approach, and not the values that were estimated based on the cost or income approach. Other fi ndings show the frequent use of replacement cost, gross or net, to the detriment of book value, a very important aspect for an emergent market, even more so as revaluation in Romania does not guarantee that dedicated valuation methodology was used. These results are all the more important as land and buildings were the majority of fi xed assets valuated, with the highest values as a result of the real estate bubble prior to the fi nancial crisis, and with an essential role in the activity of the companies.en
dc.formattext
dc.format.extent15 strancs
dc.identifier.doi10.15240/tul/001/2016-2-007
dc.identifier.eissn2336-5604
dc.identifier.issn12123609
dc.identifier.urihttps://dspace.tul.cz/handle/15240/165974
dc.language.isoen
dc.publisherTechnická Univerzita v Libercics
dc.publisherTechnical university of Liberec, Czech Republicen
dc.publisher.abbreviationTUL
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dc.relation.ispartofEkonomie a Managementcs
dc.relation.ispartofEconomics and Managementen
dc.relation.isrefereedtrue
dc.rightsCC BY-NC
dc.subjectvalue allocation,en
dc.subjectfinancial reportingen
dc.subjectinternational valuation standardsen
dc.subjectinternational financial reporting standardsen
dc.subjectfair valueen
dc.subjectreal estateen
dc.subjectcredibilityen
dc.subject.classificationM21
dc.subject.classificationG32
dc.titleVALUE ALLOCATION – CONTRIBUTION AND RISK TO THE RELIABILITY OF FINANCIAL REPORTINGen
dc.typeArticleen
local.accessopen
local.citation.epage119
local.citation.spage105
local.facultyFaculty of Economics
local.fulltextyes
local.relation.abbreviationE+Mcs
local.relation.abbreviationE&Men
local.relation.issue2
local.relation.volume19
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