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Shareholder Value Creation by Acquiring Firms in Emerging Markets - Research Proposal Example

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This research proposal describes shareholder value creation by acquiring firms in emerging markets. This paper demonstrates a burning topic that is related to the analysis of current valuation techniques with respect to fair value measurements in line with SFAS 157. This paper demonstrates objectives and proposed methodologies…
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Shareholder Value Creation by Acquiring Firms in Emerging Markets
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Download file to see previous pages Effective from January 1, 2009, all publicly listed companies shall be required to report fair value based accounting statements that shall include the market value of all assets owned by the organizations – like real estate, intellectual properties, patents, brands & trademarks, copyrights, research databases, etc. Given that this is a completely new type of accounting, a number of questions are popping in the minds of accounting professionals. Given that this is an entirely new governance system, a number of experts are trying to answer such questions or raise more questions. The author proposes to undertake a broad educational perspective of this subject by assessing the current company valuation techniques and then try to evaluate if these techniques are feasible to carry out fair value measurements of company assets. [Mard, Michael J. 2008] Fair value measurements have been in discussions for many years but post the current Sub-Prime crisis the same is in the process of getting mandatory for publicly listed organizations and a number of private companies as well. This new requirement is expected to trigger a number of researches in the industry trying to answer the questions that are raised by practicing accountants of the industry. The author proposes to contribute by trying to answer the following Research Questions pertaining to the proposed research:
In an interview with Mr. Robert H Herz, FASB Chairman, he emphasized that the SFAS 157 is not the first introduction of the concept of Fair Value Measurements. Fair Value has appeared in many standards in the last few decades and hence is not a new concept. However, a consolidated standard of fair value from the GAAP perspective was needed and SFAS 157 was introduced to fulfill this criterion. The emphasis of fair value is to provide accurate information to those individuals that study financial statements and then take decisions on investments & credits based on such statements. Fair value is not essentially a replacement of historical costs but is an additional projection to the users of the accounting statements about the current market valuation of assets whereby cash assets and cash equivalents should be depicted separately.  ...Download file to see next pages Read More
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