ABSTRACT Date: 2022-06-02 Level: Bachelor thesis in Business Administration, 15 cr Institution: School of Business, Society and Engineering, Mälardalen University Authors: Simon Lid 1997-02-27, Alexander Sollén 1997-08-09 Title: How fair is the fair value? Supervisor: Oksana Feicher Keywords: Fair value, reliability, IFRS 13, IAS40, investment property, unrealized gains, realized gains Research questions: How accurate is the fair value correlation to the actual selling price? Does unrealized gains and losses correlate with the profits? Purpose: The purpose of the study is to examine how reliable the fair value of investment property is in Swedish public companies, and how the valuations affect the profits. Method: In order to answer the research questions of the study a quantitative research method was applied using data from the company’s financial reports during the years of 2005 through 2020. Descriptive statistics have been used to compare the companies and the industry as whole. To study the reliability, two variables have been calculated. The actual gains in comparison with the sales and the unrealized gains in comparison with the profits. To further invigorate the study correlation analysis has been applied to see if there were any correlations between the two variables. Conclusion: The result of the study shows a deviation by approximately 12% of the company’s fair value. Based on the results of the study a conclusion can be drawn that the regulations permit a valuation that is not reliable and show a deceptive picture of the company. Previous research discussed caution, adjustment of profits and interpretation as factors behind the result. The study shows that during the period of the research an average conjunction of 60,08% between unrealized gains and profits were shown. Further a conclusion can be made that the profits are correlated with the unrealized gains.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:mdh-58507 |
| Date | January 2022 |
| Creators | Sollén, Alexander, Lid, Simon |
| Publisher | Mälardalens universitet, Akademin för ekonomi, samhälle och teknik |
| Source Sets | DiVA Archive at Upsalla University |
| Language | Swedish |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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