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The association between firm characteristics and CFO's opinions on the fair value option for non-financial assets

Author

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  • Jung, Boochun
  • Pourjalali, Hamid
  • Wen, Eric
  • Daniel, Shirley J.

Abstract

SFAS 157 provides a common definition for fair value while SFAS 159 expands the applicability of the fair value option. This paper analyzes the responses of 209 CFOs of U.S. firms to a survey asking whether they would choose the fair value option for non-financial assets (FVONFA) and investigates the determinants of CFOs' responses to the option. One of our results suggests that CFOs in the U.S. are resistant to the FVONFA, consistent with prior studies based on firms in Europe and Australia. Our results also suggest that firm size, leverage, the amount of non-financial assets, and expertise in fair value measurements all positively affect the CFOs' responses to the FVONFA.

Suggested Citation

  • Jung, Boochun & Pourjalali, Hamid & Wen, Eric & Daniel, Shirley J., 2013. "The association between firm characteristics and CFO's opinions on the fair value option for non-financial assets," Advances in accounting, Elsevier, vol. 29(2), pages 255-266.
    • Handle: RePEc:eee:advacc:v:29:y:2013:i:2:p:255-266
    DOI: 10.1016/j.adiac.2013.03.002
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    References listed on IDEAS

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    Cited by:

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    3. Greiner, Adam J., 2015. "The effect of the fair value option on bank earnings and regulatory capital management: Evidence from realized securities gains and losses," Advances in accounting, Elsevier, vol. 31(1), pages 33-41.

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