Reconstruction of Financial Information Disclosure Based on Price Discovery Process

The market price,the basis of historical cost and fair value, has many kinds of comparability. Ignorance of the comparability difference is one of the reasons why sub-prime loan crisis broke out. On that account, a new idea to innovate the accounting measurement has been proposed according to the theory of common price understanding. All transactions have been suggested to be divided into two types as Class I that can reach a common price understanding and Class II that is difficult to reach a common price understanding, so that transactions affecting the formation of the common price understanding can be distinguished from those that cannot. Loss of transaction attribute and confusion of price comparability resulted from the merger of various transaction data are avoid by the approach to add a “Class II transaction Statement” to the original basis of accounting statements, so as to achieve the purpose of enhancing the quality of accounting information and to adapt to the development of capital market.