历史成本Presentation.ppt

What is,Historical cost,Historical cost,Historical cost is a generally accepted accounting principle requiring all financial statement items be based upon original cost. Historical cost means what it cost the company for the item. It is not fair market value. This means that if a company purchased a building, it is recorded on the balance sheet at its historical cost. It is not recorded at fair market value, which would be what the company could sell the building in the open market.,In accounting, historical cost is the original monetary value of an economic item. Historical cost is based on the stable measuring unit assumption. In some circumstances, assets and liabilities may be shown at their historical cost, as if there had been no change in value since the date of acquisition. The balance sheet value of the item may therefore differ from the “true“ value.,Historical cost,Historical cost basis (original cost),Under the historical cost basis of accounting, assets and liabilities are recorded at their values when first acquired. They are not then generally restated for changes in values. Costs recorded in the Income Statement are based on the historical cost of items sold or used, rather than their replacement costs.,The historical cost accounting is the situation in which accountants record revenue, expenditure and asset acquisition and disposal at historical cost: that is, the actual amounts of money, or moneys worth, received or paid to complete the transaction.,The historical,cost accounting,Alternatives,Replacement costs,One of the current asset value The estimated amount that would have to be paid in order to replace the asset as the date of valuation. A possible alternative to historical cost method.,Advantage and disadvantage,advantage： it focuses on the services the asset will provide rather than the precise（古板的）physical asset. disadvantage： The costs have to be estimated so it is not very objective. It also does not provide the various choices and features that historical cost accounting has to offer.,How is historical accounting better than alternatives?,Historical cost is the standard form of accounting still. accountants are reluctant to price the assets at current market value. Under historical cost accounting there is no room for manipulation because the data is supported by evidence. with a significant range of alternatives in recognizing, reporting and measuring economic information. historical cost is based on recording actual transactions and the figures are reliable. Financial statements based on historical cost have been found to be useful.,Gain from European location:,European is famous for its tourism; Europe is near the Middle East and Africa,Disadvantages,The European found it harder than the Americans to raise money and recruit staff. In finance，European wanted to see proven assets and a proven cash flow。 Hiring good staff proved to be another problem in Europe Lack of talent，Although Western Europe suffers from 10 per cent unemployment technical staff such as Web designers is rare. the Americans had an advantage because portals are much less developed in Europe. The Europeans faced other mounting pressures. Their investors wanted to see a profit.,Question 3,What can European policy makers do to improve opportunities available to start-up companies? What can US policy makers do to encourage the growth of such companies?,Firstly,As having analyzed from the case, we see that European Rent-a-holiday is defeated by American VacationS, by contrast of ways in operating company, we find there are some differentiations which cause Europeans failures:,Firstly,1.At the beginning of the start-up period for the company, when facing the shortage of cash flows, Europeans way is to raise money in direct investment through cash, while Americans prefer with financial options.,Firstly,2.In the way of hiring employees, VacationS attracts more good staffs three times than Rent-a-holiday. Due to the different nations conceptions, Europeans prefer to a stable and comfortable welfare in such a company like IBM while Americans like more challenges and pressures. In addition, motivation welfare policies differ from two companies; Americans consider more on the employees salary and stock options while Europeans do less consideration.,Firstly,3.As Internet possesses initiation, it is famous around the world and owns a lot of customers to search in, the higher traffic is absolutely. Its brand and potential goodwill is well-known by the worldwide users. However, for the Europeans ideas of investment, they are concentrated in a rush profit instead of Americans long term plan.,Secondly,Then through the analyzed failures for Europeans, we can discuss what European policy makers can do to improve opportunities to start-up companies better, some innovative suggestions are given as follows:,Secondly,1.Europeans policy makers can encourage the Portfolio investment, increase the profit like IRR or decrease the risk for investors from it, meanwhile, they can raise the debt rate for banks, and in this way, there is a lower profit in cash investment,Secondly,2.By the second failure, the makers can make the laws to force companies to increase salary and give a series of stock options for employees. Then they can strengthen the education to develop more technological good staffs to satisfy companies demands.,Secondly,3.In this tip, I t