Estimation Methods of Property and Investments in an Accounting and Financial Statements

Abstract

The different cost estimation methods of investment projects and property of investment sphere in accounting and financial statements in the moment of acquisition and upon the date of preparing the balance sheet. All methods had been divided into two groups: conservative and dynamic. The variants of estimation after an actual cost, normative cost, acquisition and remaining cost are attributed to the first group; and after a present value, fair and discounted value, expert estimation are are attributed to the second group.
Among methods selected and given critical estimation to the expense method which is based on a historical (actual) prime price. It has given priorities at legislative level, it predominates in practice of national accounting. However in the conditions of undeveloped investment market and progressive inflation it can’t gives an objective estimation of long-lived assets and enterprise capital on the whole.
To utillize other estimation methods of long-term objects at the investment sphere in certain combination: on a fair market value, by the rule of lower estimation (the prime price or market value), method of participating in a capital, expected discounted profits and other had been suggested.