Role of Fair Value Accounting in Shaping Investor Confidence: Primary Evidence from Kathmandu Valley

Crossmark

Article Sidebar

Page Numbers: 624-636
Download PDF
Published: Jul 17, 2025
Digital Object Identifier: 10.58578/ijemt.v3i2.6575
Save this to:
Save to Mendeley Download RIS

Article Metrics:
Viewed: 264 times
Downloaded: 173 times
Article can trace at:

Author Fee:
Free Publication Fees for Foreign Researchers (USD 0.00)
Check for article on SINTA:

LYAS Publisher cordially invites qualified professionals to serve as Editors or Reviewers. Your expertise will make an important contribution to maintaining and strengthening the academic quality of our publications. Interested applicants are kindly requested to complete the application form at the following link: Editors & Reviewers

Connected Papers:
Connected Papers


Please feel free to contact us if you need any further information about the submission process or if you have any additional questions.


Authors:
Purushottam Subedi1*, Alok Kumar2
Copyright :

Authors retain copyright and grant the journal right of first publication.

Explore Our Journals
Find the journal that best fits your research. If this journal does not match your manuscript’s scope, explore our portfolio below to select a more suitable publication venue.

Main Article Content

Purushottam Subedi
Singhania University, Rajasthan, India
Alok Kumar
Singhania University, Rajasthan, India

Abstract

Fair Value Accounting (FVA) plays a critical role in financial reporting by aiming to reflect the accurate economic value of assets and liabilities. However, its influence on investor confidence remains underexplored in emerging economies such as Nepal. This study examines investor perceptions of FVA and investigates the relationship between key accounting dimensions and investor confidence. Employing a cross-sectional, quantitative research design, data were collected via a structured questionnaire from 385 respondents, including BBS and MBS students, freelance investors, and teaching faculty using convenience sampling within the Kathmandu Valley. The results reveal significant positive relationships between FVA components and investor confidence. Specifically, transparency, valuation reliability, and frequent revaluation significantly enhance investor confidence, whereas volatility does not show a meaningful effect. The regression model accounted for over 54% of the variance in investor confidence. The study concludes that enhancing the clarity, reliability, and frequency of fair value reporting can substantially improve investor trust in Nepal’s financial markets, offering practical implications for policymakers, regulators, and accounting professionals.

Keywords:
Share Article:

Citation Metrics:

Scopus

Downloads

Download data is not yet available.

Citation Metrics & Similar Scopus Articles

Data source Crossref
0
citations
Citation counts are source-specific and may differ because database coverage, reference matching, and update schedules are different. Counts are not added together. Crossref values represent citation links registered and matched by Crossref.
Check Secondary Documents in Scopus
Open this article in Scopus, then check the Secondary documents tab. Use Manual Citation Fallback only for counts you have verified manually.
Open in Scopus
Similar Scopus Articles
Scopus
  1. Esmaeelpour E. (2027)
    The role of semantic transparency in lexical processing of head-first endocentric compounds in Persian
    Language Related Research, 17(4), 231-261
  2. Liu Q. (2027)
    Elucidating the Respective Roles of Photochemical and Photothermal Effects in Photocatalytic Methanol Decomposition
    Nano Micro Letters, 19(1)
  3. Wu Y. (2027)
    Strategies of Designing High-Efficiency Electrolyte Additives for Aqueous Magnesium Batteries: A Review
    Nano Micro Letters, 19(1)

Article Details

How to Cite
Subedi, P., & Kumar, A. (2025). Role of Fair Value Accounting in Shaping Investor Confidence: Primary Evidence from Kathmandu Valley. International Journal of Education, Management, and Technology, 3(2), 624-636. https://doi.org/10.58578/ijemt.v3i2.6575

Creative Commons License
Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.

References

Barth, M. E. (1994). Fair value accounting: Evidence from investment securities and the market valuation of banks. The Accounting Review, 69, 1–25.

Christensen, H. B., & Nikolaev, V. V. (2013). Does fair value accounting for non-financial assets pass the market test? Review of Accounting Studies, 18(3), 734–775. https://doi.org/10.1007/s11142-013-9232-3

Costa, M., & Guzzo, G. (2013). Fair value accounting versus historical cost accounting: A theoretical framework for judgment in financial crisis. Corporate Ownership and Control, 11(1), 147–153. https://doi.org/10.22495/cocv11i1conf2p6

Dalwadi, P. (2023). Fair value accounting: Benefits, challenges and implications for financial reporting. VIDYA - A Journal of Gujarat University, 2(2), 121–124. https://doi.org/10.47413/vidya.v2i2.226

Dusan, A., Gurcharan, S., & Anwar, H. (2021). Fair value accounting: Perspective on stewardship function. Journal of Accounting and Taxation, 13(4), 226–242. https://doi.org/10.5897/jat2021.0483

Elfaki, A. A. A., & Hammad, S. M. E. (2015). The impact of the application of fair value accounting on the quality of accounting information: An empirical study on a group of companies listed on the Khartoum Stock Exchange. International Journal of Academic Research in Accounting, Finance and Management Sciences, 5(1), 197–214. https://doi.org/10.6007/IJARAFMS/v5-i1/1517

Elsiefy, E., & ElGammal, W. (2017). The effect of using fair value accounting on fundamental analysis: Some evidence from the emerging economies. Journal of Developing Areas, 51(3), 103–121. https://doi.org/10.1353/jda.2017.0073

Goh, C., Lim, C. Y., Ng, J., Pan, G., & Ow Yong, K. (2021, September). Trust in fair value accounting: Evidence from the field. Paper presented at the Third International Conference on Accounting and Finance, Singapore. Ministry of Education (Singapore) Tier 2 grant (MOE2014-T2-2-137).

Laux, C., & Leuz, C. (2009). The crisis of fair-value accounting: Making sense of the recent debate. Accounting, Organizations and Society, 34(6–7), 826–834. https://doi.org/10.1016/j.aos.2009.04.003

McDonough, R., Panaretou, A., & Shakespeare, C. (2020). Fair value accounting: Current practice and perspectives for future research. Journal of Business Finance & Accounting, 47(3–4), 303–332. https://doi.org/10.1111/jbfa.12447

McGregor, S. (2022). Fair value accounting impact on decision-usefulness of accounting information: Evidence from accounting standards update 2016–01 on the US insurance industry. Journal of Financial Reporting and Accounting, 20(5), 926–952. https://doi.org/10.1108/jfra-12-2020-0352

Mert, I. (2013). The use of fair value accounting, business outcomes, and investor confidence for selected Romanian and Turkish firms. Annales Universitatis Apulensis, 1(15), 54–61. https://doi.org/10.29302/oeconomica.2013.15.1.4

Pompili, M., & Tutino, M. (2019). Fair value accounting and earning management: The impact of unobservable inputs on earning quality. Evidence from the US. Corporate Ownership and Control, 16(2), 8–18. https://doi.org/10.22495/cocv16i2art1

Procházka, D. (2011). The role of fair value measurement in the recent financial crunch. Prague Economic Papers, 20(1), 71–88. https://doi.org/10.18267/j.pep.388

Shehu, T. S., & Olukeye, O. (2025). The impact of fair value accounting on financial statement reliability and investor decision-making: A comparative study of IFRS and local GAAP. International Journal of Modern Science and Research Technology, 3(5), 487–498.