FAIR VALUE VERSUS HISTORIC COST: ADVANTAGES AND DISADVANTAGES

Marian Socoliuc

Abstract


For any Romanian specialist who is in a high stage regarding the perception and understanding of international accounting standards, it is quite easy to realize that at their basis are two important categories of principles: the principles of recognition and the principles of measurement.

Recognition is the process of incorporating an accounting element in an entity's financial statements. This process is an indispensable process for the entity, but using the methods used within it, the entity may alter, "cosmetize" and artificially reinforce its financial ratios.


Keywords


fair value, historical costs, tangible assets, financial reporting, national and international accounting standards.

References


Grosu V., Horga P., Consideration regardin IFRS 3 Business Combination, http://steconomiceuoradea.ro/anale/volume/2008/v3-finances-banks-accountancy/226.pdf

Mateș D., Socoliuc M., Grosu V., Consideration the just value of finacial instruments according to the IAS 32 and IAS 39, https://www.ceeol.com/search/article-detail?id=188619

Socoliuc M., Grosu V., Financial instruments evaluation and the difficulties of economic and financial communication, Annals of the „Constantin Brâncuşi” University of Târgu Jiu, Economy Series, Issue 2/2015

Stanadardele Internaționale de Raportare financiară, Editura CECCAR , București ,2015

IAS 16 Property, Plant and Equipment, https://www.iasplus.com/en/standards/ias/ias16

IAS 32 Financial Instruments: Presentation, https://www.iasplus.com/en/standards/ias/ias32

IAS 36 Impairment of Assets, https://www.iasplus.com/en/standards/ias/ias36

IAS 41 Agriculture, https://www.iasplus.com/en/standards/ias/ias41

IFRS 3 Business Combinations, https://www.iasplus.com/en/standards/ifrs/ifrs3

IFRS 7 Financial Instruments: Disclosures, https://www.iasplus.com/en/standards/ifrs/ifrs7

IFRS 9 Financial Instruments, https://www.iasplus.com/en-us/standards/international/ifrs-en-us/ifrs9


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