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Document Type |
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Thesis |
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Document Title |
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THE IMPACT OF APPLYING FAIR VALUE ACCOUNTING ON CREDIT GRANTING DECISIONS IN SAUDI BANKS أثر تطبيق محاسبة القيمة العادلة على قرارات منح الائتمان في البنوك السعودية |
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Subject |
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Faculty of Economics and Management |
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Document Language |
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Arabic |
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Abstract |
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The main objective of this study is to identify the influence of Fair Value accounting on granting credit decisions in Saudi Banks. It also clarifies the effect of applying this practice on some specific characteristics of accounting information as well as indicating the significant obstacles facing decision-makers to grant credit in domestic banks in terms of assets and liabilities, which measured by Fair value accounting. It identifies the important proposals to address these impediments by applying this standard on Saudi commercial banks as well.
In order to achieve the study’s objective, the analytical descriptive method was used. 120 questionnaires were distributed, and 67 were valid for statistical analysis. The study was conducted on a random sample in the Companies Department within Saudi commercial banks.
The study outcomes demonstrate how Fair Value accounting may influence making reasonable credit decisions as it affects the accounting information provided by credit-seeking companies. It seems more appropriate to make significant decisions in regard to grant credit, and it could be more reliable than the one provided on the historical cost scale. Moreover, the research exposes some challenges that decision-makers may confront such as preparing financial statements in accordance with Fair Value accounting. It can be manipulated to a large extent, thereby losing data objectivity. The lack of an efficient market is another major reason of not applying this practice as a required term.
The researcher recommends that Saudi commercial banks have to train their employees, especially within the Companies Section, in order to be more qualified of the Fair Value practices. He realizes, after visiting some domestic banks to hand out the survey, that the employees have a lake of knowledge about the importance of this practice. The study advises the Saudi Organization for Certified Public Accountants (SOCPA) to provide some clarifications and remove ambiguities related to the measurement of Fair Value through hosting conferences or seminars. Furthermore, he encourages the organization to establish controls that measure this standard, reduce the manipulation rate and make some administrative intervention in its measurement. Finally, the researcher suggests the Accounting departments in Saudi universities to update and develop the accounting curricula to keep up with the new accounting changes in the Kingdom of Saudi Arabia. |
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Supervisor |
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Prof. Dr. ABDUL AAL HASHIM ABU KHASHBAH |
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Thesis Type |
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Master Thesis |
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Publishing Year |
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1441 AH
2020 AD |
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Added Date |
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Monday, June 29, 2020 |
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Researchers
| هشام جمال بشهر | BASHHAR, HESHAM GAMAL | Researcher | Master | |
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