The role of applying fair value measurement in enhancing the value of the economic unit

Abstract

The research aims to adopt fair value accounting standards that make the financial statements an important tool in the hands of the administration on the basis of the actual reality of the economic unit and the impact of this on the value of the stock, up or down and thus influence the value of the economic unit and also identify the concept of fair value and the reasons for going to fair value accounting and its reflection On the value of the economic unit.In this context, the study seeks to apply the discounted cash flow method in practice to one of the economic units registered in the Iraq Stock Exchange (the Iraqi Economic Unit for seed production). In order to reach the required rate of return. The researcher measured the indicators of the capital asset pricing model, which is represented by both Beta and earnings per share, as the researcher extracted the weighted average cost of capital (discount rate), and the researcher used in order to measure the final value of the economic units of the research sample, the method of ownership multiplier (fixed growth model). Where the net assets were extracted according to the fair value accounting and the preparation of the list of financial position of the economic unit of the research sample.

Keywords

The research aims to adopt fair value accounting standards that make the financial statements an important tool in the hands of the administration on the basis of the actual reality of the economic unit and the impact of this on the value of the stock, up or down and thus influence the value of the economic unit and also identify the concept of fair value and the reasons for going to fair value accounting and its reflection On the value of the economic unit.In this context, the study seeks to apply the discounted cash flow method in practice to one of the economic units registered in the Iraq Stock Exchange, the Iraqi Economic Unit for seed production. In order to reach the required rate of return. The researcher measured the indicators of the capital asset pricing model, which is represented by both Beta and earnings per share, as the researcher extracted the weighted average cost of capital, discount rate, and the researcher used in order to measure the final value of the economic units of the research sample, the method of ownership multiplier, fixed growth model. Where the net assets were extracted according to the fair value accounting and the preparation of the list of financial position of the economic unit of the research sample.