Substansrabatt eller premie i fastighetsbolag - En studie av effekterna av IAS 40
Abstract (Summary)In an effective market companies’ value is as much as the market is willing to pay.The real estate market has been characterized for a long period of time by the fact that the shares has been bought for a less value than the total property assets of the company, this is called substance discount. Lately the real estate companies’ shares value has increased prominently; the interest has been a contribution cause. In the essay we will study if there are any further factors that have led to this increase in the shares value. The focus is on the new accounting standards from IASB. One standard, IAS 40, affect the real estate business in particular. The standard means that the real estate companies will present their real estates to fair value in the balance sheet and profit and loss account rather than as earlier using the acquisition cost with depreciations and write downs. The market value has increased lately and the real estate companies will therefore present higher profits and a larger equity according to IAS 40. The purpose is to study the substance discounts development during the 2004 autumn and the 2005 spring in real estate companies that are quoted on the Stockholm stock market, and to investigate if the new standard IAS 40 is a contributing cause to the real estate shares’ increase.Both qualitative and quantitative data has been collected. We have carried out qualitative interviews with experts within the real estate area. Quantitative data has been collected from respective companies’ annual reports to calculate substance discounts/reward. We have come to the conclusion that the substance discount has decreased and passed to a meagre reward. The alignment of the accounting experts shows that focus has been on IAS 40 during the 2004 autumn and that this has been a contributing cause to the shares’ increase. They also mean that this new account numbers has a certain psychological effect, with that will IAS 40 create larger fluctuation on the stock market. The analytics means that the substance discount will disappear in the future, due to new participants, possibilities to rationalise and lower interests. Therefore a larger focus will be on cash flow analyses than before and IAS 40 will not affect the rates.
Source Type:Master's Thesis
Date of Publication:07/05/2005