Global Financial Crisis and Accounting Rules： The Implications of the New Exposure Draft （ED） Financial Instruments： Expected Credit Losses on the Evaluation of Banking Company Loans

During the financial crisis, the delayed recognition of credit losses on loans and other financial instruments was identified as a weakness in existing incurred loss model of impairment stated by International Accounting Standards （IAS） 39, because it is believed that this delay might generate pro-cyclical effects. In response to the recommendations of G20, Financial Crisis Advisory Group （FCAG）, and other international bodies, the International Accounting Standards Board （IASB） has undertaken, since 2009, as a part of the project to replace IAS 39, a project （partially shared with Financial Accounting Standards Board （FASB）） aimed at introducing an expected loss model of impairment. Within the scope of this subset project, the IASB has previously issued two exposure documents proposing models to account for expected credit losses： an exposure draft （ED） Financial Instrument： Amortized Cost and Impairment, published in November 2009, and a supplementary document （SD） Financial Instrument： Impairment, published jointly with the FASB in January 2011. However, neither of the two proposals received strong support from interested parties. Recently, the IASB, after the FASB＇s decision to withdraw from the joint project and to develop a separate expected credit loss model based on a single measurement approach consisting in the sole recognition of lifetime expected credit losses, published a third proposal--Ahe so-called expected credit losses model （ED/2013/3 Financial Instruments： Expected Credit Losses）.

How to Recognize and Measure Compound Financial Instruments?

Basing on the Xiaomi case,this paper discusses the most appropriate accounting treatment of compound financial instruments under the framework of International Financial Reporting Standards(IFRS)and how other comprehensive income(OCI)plays important role in it.Overall,this paper provides some references for policymaker to standardize financial instruments standard.

Off- balance- sheet Information Disclosure of Listed Bank Derivative Financial Instruments

With China＇s progressive multi-level capital market strategic direction, as well as the gradual implementation of the mixed operation of commercial banks. Derivative financial instruments will be further developed in commercial banks. This paper focuses on the information disclosure of derivative financial instruments by commercial banks, combined with the standard of disclosure of off-balance-sheet information of international derivative financial instruments, using the disclosure index and project disclosure ratio to analyze the disclosure of derivative financial instruments of listed banks in our country, Off-balance sheet information disclosure, and puts forward suggestions on how to further improve the quality of off-balance-sheet information disclosure of derivative financial instruments in China.

The possible effects on the future management of local Italian authorities following the use of financial derivative instruments

The appeal from municipalities, provinces and regions to financial derivative instruments is tied to the need of overcoming the situations in a state of urgency inherent in a balance. On average, one local Italian authority in twenty has decided to underwrite a derivative product, giving life to a number of contracts that had a value of over 35 billion euro with an average value of 6.5 million for each contract until 2007. The boom of swaps has, since 2000 on, experienced a peak period from 2003 to the end of 2005, in which the Euribor rate touched a very low level, maintained itself for long periods at around 2% and fallen in some cases even under this value. Many of the contracts completed before 2006, which link the debt of local authorities to variable rates, but also many of those completed from 2006 onwards that moved debt onto fixed rate, which are now a source of loss for the balance of local authorities that have underwritten them. In the 2002-2008 period, the number of the stipulation of contracts local authorities reported to the Ministry of Economy and Finance is about 900, corresponding to more or less 150 per year, which affected 18 regions, 44 provinces, 532 municipalities and 4 mountain commtmities, for a total of 594 authorities. Therefore, the local authorities have approached the derivative instruments in an often approximate way without a real awareness, both for the conditions that were being negotiated and the effects that they would have produced in perspective. The purpose of this work is to highlight the consequences of the use of derivative instruments on the future management of local authorities.

The Relationship Between Financial Reporting Standards （FRS） 139 and Audit Pricing： The Case of Malaysia

This study provides some insights for auditors to gauge the complexity of the financial statements verification process to comply with the ambiguous standard, namely, Financial Reporting Standards （FRS） 139 in Malaysia. Hence, the purpose of this study is to examine the relationship between the adoption of FRS 139 and the audit fees charged to clients. The final sample consists of 1,050 finn-year observations covering the period from 2006 to 2008 from the non-financial companies listed on the Bursa Malaysia. In this study, the static panel data analysis is used to provide richer interpretation and a powerful understanding of the effect of standard adoption on audit pricing. The regression results from the random effects Generalized Least Squares （GLS） suggest that FRS 139 adoption has not significantly increased audit fees. The small number of observations for FRS 139 voluntary adoption is suspected to be the main limitation factor contributing to the insignificant result of the hypothesis. It is suggested that the limitation of small observations of FRS 139 voluntary adopters might be encountered during the period of mandatory adoption. Therefore, future research might investigate the impact of mandatory FRS 139 adoption.

Decision making on financial investment in Turkey by using ARDL long-term coefficients and AHP

Mathematical modeling methods are frequently used for solving everyday problems.Decision making,one such method,can be used in every aspect of life for different scales such as micro(households),medium(companies),and macro(states)decisions.Due to the large number of parameters affecting decision,it is possible to make mistakes in the selection of the appropriate investment instrument with classical methods;hence,scarce resources may be wasted,and sometimes it may even be impossible to make a decision.This study seeks to answer the question“Which financial investment instrument should be selected under the current conditions?”using decision making problems.Factors affecting gold,USD,and EURO,which are selected as the financial investment instruments in Turkey,are examined using the autoregressive distributed lag(ARDL)bound test.The selected variables are monthly and belong to the January 2009 to May 2018 period.The ARDL results show that the selected financial investment instruments are affected by most of the factors separately.By using the coefficients obtained from the ARDL model,the analytic hierarchy process(AHP)model was established.According to the results of the model,the EURO was determined as the most suitable financial investment for Ahmet and others with the same preferences.

The impact of credit risk transfer on financial stability

The development of credit risk transfer market disperse the credit risk of banks, at the same time, also give a threat to the whole financial system with instability. This paper from the influence factors of financial stability, explores how credit risk affecting the stability of financial system. Research found that the rating risk of credit risk transfer can cause default contagion in the financial markets.

Economic Factors in the Use of Renewable Energy Sources in Kazakhstan

The purpose of this research was to study economic incentives to use renewable energy sources in the Republic of Kazakhstan and to give suggestions for production and circulation of the ＂green＂ certificates as a new financial instrument. The author analyzed European Union and Kazakhstani experience of economic incentives to reduce emissions and introduction of renewable energy sources. As a result of conducted research, the proposal to produce and circulate new financial instruments in Kazakhstan is made; as well as economic and environmental factors of renewable energy sources in the Republic of Kazakhstan are defined.

Transition Effects from the Initial Adoption of IFRS 9 by Italian and German Blue Chip Companies

For the financial years from 2018,the new standard for accounting of financial instruments,IFRS 9,was applicable for the first time.Various questions arose in connection with the transition.For example,how high would the resulting transition effect be on equity?Another aspect related to the question of the extent to which the fair value measurement(through profit or loss)would increase.It is also of interest whether the previously presented IFRS 9 changes are classifiable as being material.Through the analysis of the financial statements of FTSE MIB and DAX 30 companies that were prepared for the first time in accordance with IFRS 9 in the year 2018,answers are given in this article to the aforementioned questions and a comparison is made regarding the extent to which national differences or commonalities existed.In the overall view of the absolute change in equity,for the FTSE MIB companies,a mean value of€-3.03 million was calculated and for the DAX 30 companies,€-34.29 million.The equity ratio(median),however,only declined marginally in percentage points with the FTSE MIB companies(-0.07),as well as with the DAX 30 companies(-0.02).With regard to the migration of financial assets,it has been shown that the accounting and measurement of more than 90%of financial assets of the FTSE MIB and DAX 30 companies have not changed.With the rest,the measurement net at fair value(through profit or loss)increased in both stock exchange segments.Nearly all changes to equity,the FTSE MIB,as well as DAX 30 companies,can be classified as immaterial.The extent to which the expansion of the measurement of financial instruments,which are measured at the fair value(through profit or loss)can be material,will ultimately depend on the individual case,in view of the future IFRS financial statements.This then depends on how high the actual change in fair value(through profit or loss)of these holdings is in a period in an individual case,in absolute and relative terms—for example,in proportion to the equity and the P&L.The latter also applies to FTSE MIB,as well as DAX 30 companies.

Institutions and accounting standard transformation:Observations from Japan

This paper describes the transformation of Japan's accounting standards over the past 2 decades and the driving forces behind this transformation. It also analyzes the current state of Japan's accounting standards, which are characterized by the dichotomy of accounting systems inherited from the country's political, economic and legal institutions. The discussion in this paper emphasizes that a single set of accounting standards is not always effective for every entity.