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Motives for Fixed-Asset Revaluation: An Empirical Analysis with Swiss Data

   

Added on  2020-02-18

9 Pages1145 Words104 Views
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Financial Accounting1
Motives for Fixed-Asset Revaluation: An Empirical Analysis with Swiss Data_1

Part 1: Summary of Academic Paper ‘Motives for fixed-asset revaluation: An empiricalanalysis with Swiss data’Purpose of PaperThis academic paper aims at investigating the major reasons responsible for fixed-assetrevaluation undertaken by the Swiss listed companies. Research QuestionsThe main research questions addressed in the study are as follows:What is the impact of revaluation motives of fixed assets on the accounting standards?What is the need of introducing revaluation model for measuring the fixed assets?BackgroundAs per the article, revaluation of fixed assets can be described as the process adopted forincreasing or decreasing the carrying value of fixed assets in accordance with the major changesin their fair market value. The AASB 116 standard has introduced changes in the measurementand recognition principle for fixed assets as per which they should be measured at either cost orat revaluation model. Research FindingsThe study has depicted that interest rates have significantly decreased for the companiesthat have adopted the revaluation model for measurement of their fixed assets and thusemphasized on the benefit of debt-costs hypothesis.Implications2
Motives for Fixed-Asset Revaluation: An Empirical Analysis with Swiss Data_2

The research paper has demonstrated the economic factors that caused the significantchanges in the accounting standards in relation to fixed-assets valuation (Missonier-Piera, 2007). 3
Motives for Fixed-Asset Revaluation: An Empirical Analysis with Swiss Data_3

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