The continuous updating and improvement of debt restructuring standards have made a revolutionary breakthrough in the vigorous development of China's social economy. This paper is about the thinking of accounting standards for enterprise debt restructuring.
Abstract: Due to the inevitable trend of economic globalization, China's socialist market economy is deepening and the capital market economy is booming. At the same time, the social and economic growth enables enterprises to develop and grow in an increasingly perfect legal environment, which also promotes enterprises to use more diversified financial instruments to carry out a series of unprecedented economic activities. The new accounting standards promulgated by China in 2006 made up for the defects of the old standards to a great extent, and then better guided the accounting work of enterprises. Compared with the old standards, the debt restructuring under the new standards has been greatly improved and expanded. The key is to re-standardize the definition of debt restructuring, clarify the concessions made by creditors in debt restructuring, and increase the fair value measurement attribute. However, there are still some shortcomings in the new debt restructuring criteria.
Keywords: debt restructuring; Fair value; Accounting standards
First, the historical background of debt restructuring
With the deepening of reform and opening up, all walks of life have developed rapidly, and the problem of creditor's rights and debts between enterprises has gradually surfaced. 1June, 998 12, China's Ministry of Finance issued the Accounting Standards for Business Enterprises? Debt restructuring. However, there are many difficulties in the implementation of this standard, such as debt exemption, and 1998 can be treated as the proceeds of debtor's debt restructuring according to the original standard, which makes some companies use debt exemption to manipulate and create the possibility of profit. In order to effectively avoid similar problems, the Ministry of Finance of China revised the original standard. Revised accounting standards for enterprises? Debt restructuring has been implemented nationwide since 20011. In 2006, China's Ministry of Finance revised the accounting standards for the second time and officially changed its name to Accounting Standards for Business EnterprisesNo. 12? Debt restructuring.
The continuous updating and improvement of debt restructuring standards have made a revolutionary breakthrough in the vigorous development of China's social economy. It has effectively changed the asset structure that most enterprises in China do not meet the requirements and cannot develop stably for a long time, which has played a positive and effective role in the development of enterprises.
Second, the definition of debt restructuring methods
According to the international debt restructuring standards of some countries, the definitions of debt restructuring are not completely consistent, but these definitions generally show two directions, one is debt restructuring in a broad sense and the other is debt restructuring in a narrow sense.
In a broad sense, debt restructuring holds that all matters involving changes in debt conditions are regarded as debt restructuring. One of the most representative countries is Australia. Australian Accounting GuidelineNo. 1 1 defines debt restructuring as:? Action taken to change or discharge the debtor's responsibility for existing debts. Which item does not include debt elimination and convertible bonds conversion? . This definition fully shows the characteristics of generalized debt restructuring.
Debt restructuring in a narrow sense is considered as debt restructuring only when the debtor has financial difficulties and the creditor makes concessions to the debtor. The most representative country is the United States, which is defined in the announcement of American Financial Accounting Standards 15. Concessions made by creditors to debtors due to financial difficulties are usually unwilling to be considered for economic or legal reasons? . This definition embodies the narrow sense of debt restructuring to the fullest.
At present, in the latest accounting standards of our country, the definition of debt restructuring refers to the matter that creditors modify the debt terms with the debtor according to the agreement reached with the debtor or the court ruling. According to China's latest debt restructuring standards, China's debt restructuring methods include:
1. Pay off the debt with cash lower than the book value of the debt (concession restructuring).
2. Pay off debts with non-cash assets.
3. Debt is converted into capital (i.e. debt-to-equity swap).
4. Modify other debt conditions, such as extending debt repayment period, extending debt repayment period plus interest, extending debt repayment period, reducing debt principal or interest, etc.
5. The combination of the above two or more ways (hereinafter referred to as? Mixed recombination method? )。
Third, the application of fair value in debt restructuring.
The United States first introduced fair value into its financial accounting standards for accounting measurement. International Accounting Standards (iasc) defines fair value as:? In a fair trade, the amount of assets exchanged or debts paid off voluntarily by the parties familiar with the situation? . At present, the fair value measurement model defined by the accounting standards implemented in China refers to the accounting model that takes the market value or the present value of future cash flows as the main measurement attributes of assets and liabilities. Different from historical cost information, fair value information reflects the overall asset status of enterprises in the market more comprehensively, which is better consistent with the balance sheet of enterprises and helps decision makers to make reasonable judgments in the future.
First of all, for the use of cash assets to repay debts. The debtor shall clearly define the difference between the book value of the restructured debt and the actual payment amount as the profit generated by debt restructuring, and include it as non-operating income in the current profit and loss measurement.
Secondly, the debtor's behavior of paying off debts with non-cash assets. Its non-cash assets can be divided into three types: one is to pay off debts with inventory materials and commodity products; The second is to pay off debts with fixed assets; The third is to pay off debts with financial assets such as stocks and bonds. The debtor shall compare the book value of the restructured debt with the fair value of the transferred non-cash assets.
The difference between the two is included in the benefits obtained in the process of debt restructuring and in the non-operating income of the current profit and loss of the enterprise. Creditors shall record the fair value of non-cash assets, and the difference between the book balance of restructured creditor's rights and the fair value of non-cash assets shall be included in the current profits and losses of the enterprise.
Third, debt-to-equity swap. The debtor shall take the total par value of the shares obtained by the creditor's waiver of the creditor's rights as the share capital, and the difference between the total fair value and the total share capital as the capital reserve. The difference between the book value of the restructured debt and the total fair value of the shares is recognized as debt restructuring profit, which is included in the current profit and loss of the enterprise as non-operating income. Creditors shall recognize the fair value of the acquired shares as their investment in the enterprise, and include the difference between the book balance of the restructured creditor's rights and the fair value of the shares in the current profits and losses of the enterprise.
Finally, for the behavior of debt restructuring by modifying other conditions. The debtor or creditor shall take the fair value of the debt or creditor's rights as the value of the restructured debt after modifying other conditions. The difference between the book value of the restructured debt and the recorded value of the restructured debt shall be recognized as the current profit and loss. Where the payable amount is involved, the debtor shall confirm the expected liabilities of the enterprise according to the payable amount, and the creditor shall not include it in the receivable amount or the book value of the restructured creditor's rights.
The current accounting standards adopt fair value as the measurement basis of debt restructuring, which can effectively reflect the economic benefits that assets may bring to enterprises in the future. Let China's accounting standards be better in line with international standards and deepen the relevance and reliability of accounting information.
Four. Problems and suggestions in the implementation of debt restructuring
There are some obvious problems in the implementation of current accounting standards in debt restructuring, which have affected the handling of debt restructuring and the financial situation of enterprises to some extent. 1. Definition of debt restructuring. The premise of debt restructuring standard is enterprise? Have financial difficulties? But the definition of financial difficulties is extremely vague. Then, how to standardize the definition of whether enterprises are facing financial difficulties has become an urgent problem to be discussed. Financial difficulties will inevitably lead to a lot of losses. The cash flow of the enterprise will also be reduced, and the debtor's dunning will force the cash flow of the enterprise to be difficult, and then it will be impossible to maintain normal business activities. This has led to financial difficulties, which will force enterprises to seek external assistance or borrow new funds. Of course, it is full of difficulties to borrow money according to one's own operating conditions, so it is the fastest and most effective choice to discuss with creditors and try to make them give in. This is consistent with the current definition of debt restructuring.
2. Consider the time value of funds. In the current debt restructuring standards, debt restructuring by modifying other debt conditions usually chooses to modify the repayment period of debts, which involves? Time? . As we all know, funds have time value, and the value of funds is different at different times. If the time value of funds is considered, the book value of restructured creditor's rights is greater than the present value of future receivables, and the creditors have made concessions in essence, resulting in losses, so they should be included in the scope of debt restructuring. Therefore, the recognition of debt value after restructuring should be measured at fair value, not at present value, which will exclude those that actually belong to the scope of debt restructuring and lead to unreliable recognition of debt restructuring gains and losses.
3. The impact on the cash flow statement. In the current standards, the income from the debtor's debt restructuring is regarded as non-operating income, and the loss from the creditor's debt restructuring is regarded as non-operating expenditure, both of which are included in the current profit and loss. Listed in the supplementary information of the cash flow statement? Net cash flow from operating activities? The indirect accounting method is adopted to bring the gains and losses of debt restructuring into the adjustment range of supplementary information. And the main table of cash flow statement is reflected by direct method? Net cash flow from operating activities? Debt restructuring is not included in the business activities of the enterprise, and the profit and loss of debt restructuring will not bring cash inflow and outflow to the enterprise, so it will not affect the cash flow during the current business period. Therefore, the above processing will lead to the main table and supplementary information of the cash flow statement. Net cash flow from operating activities? Does not match.
To sum up, constantly improving the debt restructuring criteria can effectively promote the accounting of accounting data, ensure the quality of accounting data, and make the information provided by enterprises more reliable. The formulation of current debt restructuring standards has effectively promoted the integration of China's economic market with international standardization. It is believed that with the development of market economy, the current debt restructuring criteria will be better implemented.
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