Controversies in Auditing Fair Value Accounting Estimates for Financial Assets
Author:
Univ. Prof. Tatiana DĂNESCU, Ph. D.; Lecturer Ovidiu SPĂTĂCEAN, Ph. D.
JEL:
M42
DOI:
Keywords:
fair value, accounting estimates, financial assets, institutional investors, audit approach
Abstract:
Fair value measurement used for reporting financial assets is a sensitive issue in the context of increasing the extent and complexity of financial assets traded in international capital markets. This area supplies current extensive research whose results may be the subject of real controversy. This paper aims to capture some particularities regarding the use of different measurement bases of financial assets managed by investment companies, in their capacity as institutional investors operating on the Romanian capital market. In examining the accounting estimates used for reporting financial assets at fair value, including related disclosures, some controversies may be generated by bias, controversies that fuel serious challenges for auditors involved in providing reasonable assurance regarding the accuracy, integrity and reliability of financial information. Assessing the impact of different measurement bases used for financial assets upon financial performance measured by NAV indicator is another major objective assumed in the investigative steps that have supported the research.\r\n