A Summary of the Analysis of the Problems Existing in the Development of Asset Appraisal Industry in Western China

International Journal of Engineering and Management Research e-ISSN: 2250-0758 | p-ISSN: 2394-6962
Volume-11, Issue-4 (August 2021)
www.ijemr.net https://doi.org/10.31033/ijemr.11.4.18
139 This Work is under Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.
A Summary of the Analysis of the Problems Existing in the Development of
Asset Appraisal Industry in Western China
Zhang Xue
Postgraduate Student, Engaged in Theory and Policy Research of Agricultural Economy, Zhejiang Agriculture and Forestry
University, CHINA
Corresponding Author: m17647316256@163.com
ABSTRACT
Affected by the development level of the market
economy and regional economic growth factors, the asset
appraisal industry in the three major regions of China's east,
middle and west has created regional gaps in the development
process. Among them, the asset appraisal development
problem in the western region is particularly prominent.
Therefore, the development of asset appraisal in the western
region has always been a hot topic in this field. This paper
compares the economic development level of various regions
and the development status of the asset appraisal industry,
analyzes the problems encountered in the development of the
asset appraisal industry in the western region, considers
solutions to related problems, and further thinks about the
future development direction of the asset appraisal industry
and outlook.
Keywords-- Western Region, Asset Appraisal Industry,
Industry Issues, Regional Economy
I. INTRODUCTION
Asset evaluation refers to the process in which
professionals conduct qualitative and quantitative analysis,
evaluation and explanation of the value of the evaluation
object based on the relevant data they have. Asset appraisal
is a kind of social economic activity that follows the
development of market economy and commodity
exchange, and it is an inevitable product of the
development of market economy (Jiang, 2009). Asset
appraisers and asset appraisers can maintain the smooth
progress of transactions and the fairness of transactions.
Asset appraisal develops along with the development of
market economy. Therefore, the continuous development
of the market economy drives the continuous progress and
improvement of the asset appraisal industry. An important
feature of China's economic development is the uneven
economic development of various regions(Zhang, 2004;
Sun, 2012).
Since China's reform and opening in 1978, the
economy has made world-renowned achievements.
Between 1978 and 2010, its GDP has increased by nearly
20 times, with an average annual growth rate of 9.91%,
creating a miracle of world economic development.
However, while the economy is growing rapidly, the
economic gaps in various regions of China are expanding.
This will not be conducive to the sustainable development
of China's social economy(Jiang, 2004; Pu, 2007). To
narrow the gap in economic development between regions,
it is necessary to analyze the underlying reasons for the
differences in China's regional economic development.
The factors affecting economic growth in the three major
regions of East, Central and West are also different. The
eastern region is mainly affected by per capita fixed asset
investment, human capital, technology investment, foreign
trade level and the positive effect of industrial structure;
the central region is mainly affected by marketization The
positive influence of the degree, per capita investment in
fixed assets, human capital, technology investment and
industrial structure; the western region is mainly affected
by the positive influence of per capita investment in fixed
assets, human capital and foreign trade (Zhou, 2002).
The unbalanced development of China's regional
economy is carried out under the following three distinct
backgrounds: the system transition from a planned
economy to a market economy; a comprehensive transition
from a closed economy to an open economy; and a
transition from a government-led state-owned economy to
a privately led diversified economy The connotation of
change. Large-scale institutional changes have accelerated
the realization of the imbalanced process of China's
regional economy, thereby bringing the turning point of
regional economic development from imbalance to
balanced development earlier (Cao, 2012). We believe that
the main institutional factors that affect the differences in
regional economic development includeural system
reform, enterprise system reform, opening-up policy,
government governance mechanism, and regional
development policy. The reform of these institutional
factors has changed the way of resource and factor
combination, changed the path of factor accumulation, and
changed the incentive mechanism of microeconomic
subjects facing economic activities, thus making industrial
division of labor, enterprise competition, and technological
innovation possible. Therefore, the nationwide institutional

reform and the regionally differentiated institutional
changes triggered by it are ultimately reflected in the
performance of regional economic development through
the quantitative expansion and quality improvement of
factor accumulation (Yong, 2010).
Because the government plays a macro-control
role in the market economy, the difference in the level of
economic development between the western region and
coastal areas has also caused the development of the asset
appraisal industry to have different levels in different
regions (Zhu, 2001).
II. THE DEVELOPMENT STATUS OF
THE ASSET APPRAISAL INDUSTRY
China's asset appraisal arose during the process of
reform and the construction of a socialist market economy,
and it developed rapidly as the reform of state-owned
enterprises proceeded. In the late 1980s, in order to prevent
the loss of state-owned assets and the need to determine
the fair value of property rights transfers, state-owned
assets evaluation activities appeared in China. After more
than 10 years of development, it can be said that China’s
asset appraisal industry has begun to take shape. In the
process of corporate system reform and opening to the
outside world, the interests of various property rights
subjects including state-owned assets have been
maintained, and the development of China’s market
economy has been promoted. Healthy development has
become an indispensable basic intermediary service
industry in China's booming socialist market economy. It
plays a role in promoting economic development and
social progress.
2.1 Current Status of Asset Appraisal Development in the
Western Region
2.1.1. Long-Term Politics, Chaotic Industry Management
At present, China's asset appraisal industry is
"Warring States Period", with separate regimes and self-
protection, which has led to the stagnation of the industry
itself. Analyzing the current situation of China's asset
appraisal industry, there are serious multi-management
problems. For example, in addition to registered asset
appraisers, there are multiple appraisal qualifications such
as real estate, land, and price departments. These qualified
administrative departments often abandon principles and
malicious competition for their own interests, forming
various types of appraisal industries. The bad atmosphere
casts a shadow over the development of the industry.
2.1.2. Theory and Evaluation Practice are Out of Touch
The current asset appraisal theory has a certain
degree of one-sidedness, which makes it impossible to
directly use related theories and concepts as the basis of
appraisal analysis and judgment in specific appraisal
practices. For example, we rarely choose non-market value
types in our actual appraisal practice, because we do not
have a clear theory during practice to position and explain
the choice of market value or non-market value types.
Another example is an important assumption in asset
valuation-the open market hypothesis. With the
development of society, the complete competition,
complete information, and complete rational traders
described in the open market hypothesis have been
subverted and subverted. The definition of market
cognition under asymmetric and bounded rationality has
become the mainstream. Therefore, the market described
and defined by the open market hypothesis is inconsistent
with the actual market state, and the evaluation theory
constructed based on this hypothesis has lost its
explanatory power and persuasive power in practice.
2.1.3. Empirical
The increasingly frequent asset appraisal business
enables appraisers to accumulate a wealth of appraisal
experience, which directly determines the accuracy of the
appraisal results.
2.2 The Development Status of the Asset Appraisal
Industry in the Eastern Coastal Areas
2.2.1. The Subject Corporatization of Asset Appraisal
With the continuous development of asset
appraisal agencies, it has gradually developed into a
modern enterprise with independent operation, self-
financing, clear property rights, and scientific
management.
2.2.2. Diversified Asset Appraisal Business
From the perspective of the entire asset appraisal
industry, the appraisal business covers a wide range,
ranging from the appraisal of aerospace engineering
projects to the appraisal of scraps of enterprises. The
appraisal business is almost all-encompassing.
2.2.3. The Hierarchy of Asset Appraisers is Clearer
Asset appraisal includes many types, such as real
estate appraisal, enterprise value appraisal, intangible asset
appraisal, financial asset appraisal, etc. After subdivided at
this level, the specific work content is further subdivided
2.2.4. Evaluate the Standardization of Technical
Regulations and Professional Ethics
Market-economy developed countries are striving
to achieve the standardization of evaluation technical
regulations and evaluation professional ethics. Countries
such as the United Kingdom, the United States, Australia
and other countries have formed relatively unified
evaluation rules in their own countries after a long period
of efforts. Various asset evaluation institutions and
evaluators are basically Can practice under the unified
assessment philosophy, assessment principles, and
assessment technical regulations. Relatively unified
evaluation technical regulations and evaluation

professional ethics also provide a basis and reference for
the supervision, restraint and management of the
evaluation process and its results by the society, the market
and related departments.
III. PROBLEMS IN THE ASSET
APPRAISAL INDUSTRY IN THE
WESTERN REGION
Comparing the above-mentioned asset appraisal
industry in the eastern region and the western region, it is
obvious that the current asset appraisal industry in China
has problems such as the market has not yet been unified,
regulations need to be improved, the quality of personnel
is uneven, practice behavior is not standardized enough,
and the education system is not sound. The disordered to
orderly asset evaluation market, the international
convergence of evaluation criteria, the in-depth
development of business content, and the growing
expansion of the evaluation team are the development
trends of China's asset evaluation industry. We must create
a good asset evaluation practice environment, strengthen
international exchanges, and expand the field of asset
appraisal practice, vigorously develop higher education in
asset appraisal, and deepen research on asset appraisal
theories and methods.
Due to the independence and professional
requirements of asset appraisal, in order to ensure the
quality of practice and clarify the practice responsibilities,
asset appraisal practitioners must have good professional
ethics, and they must follow strict professional standards
when engaging in asset appraisal business. Recently, the
Ministry of Finance issued the "Asset Appraisal Standards-
Basic Standards" and the "Asset Appraisal Professional
Ethics Standards-Basic Standards" drafted by the China
Assets Appraisal Association. These two basic guidelines
summarize the rich practical experience in asset evaluation
over the past ten years, put forward the basic technical
requirements and professional ethics requirements that
asset evaluation should follow, and improve the technical
standards and behaviors followed by asset evaluation
practitioners in the practice process. Standards play an
important role in guiding and regulating the practice of
asset appraisal. The implementation of these two basic
guidelines will also help the regulatory authorities and the
public to strengthen the supervision of asset appraisal
practice and practice quality, reduce or even eliminate
black-box operations, improve the transparency of practice
and management, and create a way to truly implement
legal practice and legal supervision. Condition. To give full
play to the role of asset appraisal in the market economy,
the following issues need to be paid close attention to.
First, relevant departments should fully
understand the actual and long-term impact of asset
evaluation on the economy, strengthen coordination, and
jointly study and solve problems in asset evaluation. On
the surface, the result of asset appraisal is only to put
forward the value opinion of a certain asset or right, but as
a reference for transactions, it will become a piece of
financial information. It will not only have a direct current
impact on enterprises, bank management, personal
financial management, national fiscal taxation, etc. And it
will indirectly have a long-term impact on the country's
financial and economic development. Due to the wide
range of asset appraisal service departments and service
targets, there are many links that affect the quality of asset
appraisal. In addition to appraisal agencies, governments
and enterprises are also involved. For example, the
government should create a good practice environment, the
client has the obligation to provide true and complete
information, the enterprise should improve its internal
governance structure, and the bank should strengthen risk
control. All these require relevant departments to pay more
attention to and pay more attention to the issue of asset
evaluation and strengthen communication and coordination
in policy and business.
Second, the legal system in the field of asset
appraisal is not perfect. At present, although there is no
special law covering the entire field of asset evaluation,
relevant laws and regulations such as the company law,
securities law, criminal law, and state-owned asset
evaluation management measures have a series of
regulations related to asset evaluation. Therefore, it is
necessary to thoroughly study the development laws of the
asset appraisal industry in the socialist market economy,
draw on the legislative experience of the international
appraisal industry, and combine China’s actual conditions
to formulate and improve laws and regulations in the asset
appraisal field, regulate the rights and obligations of
market entities, and clarify Legal responsibility to protect
the legitimate rights and interests of all parties involved in
the asset evaluation.
Third, there are still some problems in the self-
discipline management system of the asset appraisal
industry. As an important intermediary organization in the
market economy system, industry associations have unique
functions for regulating member behaviors and
strengthening industry self-discipline. China's legislation
on intermediary organizations is not yet complete, and the
functions of intermediary organizations are not yet
complete. It is necessary to promote the standardization of
asset appraisal industry organizations in accordance with
the requirements of the development of the socialist
market economy and the principles of marketization.

In summary, the problems of the western asset
appraisal industry have the following properties: First,
intuitiveness. This is reflected in the fact that evaluators
mainly rely on their intuitive feelings and subjective
preferences for evaluation, and the evaluation process
rarely resorts to other professional evaluation methods.
This kind of assessment is concise and clear, but the result
of the assessment is susceptible to human factors and lacks
objective impartiality. The second is non-professionalism.
Non-professionalism means that the appraiser does not
have professional appraisal methods and skills or has not
received special training. The appraisal is often carried out
by both parties to the asset transaction or a designated
person by one party, and even those who do not have much
appraisal knowledge, but within a certain range High-
ranking personnel to evaluate. simplify. The so-called
simplification means that the asset evaluation method at
this stage is relatively simple, and the evaluation process is
completed quickly.
IV. PROSPECTS FOR THE FUTURE
DEVELOPMENT OF THE ASSET
APPRAISAL INDUSTRY
In terms of development trends, the standardized
asset evaluation system is further developing towards the
diversification, refinement, and specialization of
evaluation fields, and the integration of evaluation
concepts, understandings and standards. The
diversification, refinement and specialization of the
appraisal field means that asset appraisal has gradually
spread from traditional real estate appraisal to enterprise
value appraisal, intangible asset appraisal, tax base
appraisal, and appraisal for financial reporting purposes,
with no property rights transactions. Service-oriented
development focuses on both property rights transaction
services and non-property rights transaction services.
Contrary to the trend of refined and specialized asset
appraisal, some professional asset appraisal institutions
and asset appraisers came into being. The characteristic is
that the scope of practice is concentrated in a certain
professional technical field, with a high degree of
specialization and professionalism. The technical service
standard is relatively high. At the same time,
corresponding professional evaluation norms continue to
emerge.
4.1 The Corporatization of Asset Appraisal Institutions
In the modern asset appraisal industry, asset
appraisal agencies have accumulated a large amount of
asset appraisal materials and rich experience in asset
appraisal by providing appraisal services for both parties to
asset transactions. The management model has become
increasingly characteristic of modern enterprises, and
many companies with rich appraisal experience have
emerged. As a result, a corporatized asset appraisal agency
came into being. These asset appraisal agencies rely on
their strong appraisal strength and modern management
methods to provide high-quality appraisal services for both
parties in the asset business. At the same time, the
development of many businesses has also enabled them to
achieve rapid development.
4.2 Professionalization of Evaluators
The professionals of asset appraisal agencies are
mainly divided into three categories: one is the appraisal
company's management composed of directors, managers
and other management personnel, responsible for the
company's operation and management. The second is to
evaluate the company's sales staff and be responsible for
the company's business contracting. The third is
professional appraisers. They are all appraisers with a
professional level. They are mostly professional engineers
and various experts. They are responsible for completing
the technical work of the appraisal business and are the
main force of the asset appraisal company. These
professional appraisers can be employees of the appraisal
company or part-time staff of the appraisal company, but
they must understand and master the professional theories
and business knowledge of asset appraisal. Appraisal
reports can only be issued by qualified persons such as
registered asset appraisers or value appraisers, who often
take asset appraisal as their lifelong career.
4.3 Diversification of Assessment Business
The fierce market competition has prompted the
evaluation company to focus on brand cultivation,
continuously expand its business scope through high-
quality services, and implement a diversified business
strategy. The scope of asset appraisal business is very
wide, including tangible asset appraisal and intangible
asset appraisal. It can even be subdivided into machinery
and equipment appraisal, mineral resource appraisal and
real estate appraisal, etc. It covers almost all business types
in the asset appraisal industry.
4.4 Scientific Evaluation Means and Methods
In the standard evaluation stage, modern science
and technology and methods have been widely used in
asset evaluation, greatly improving the accuracy and
scientificity of asset evaluation results. With the
continuous expansion of asset appraisal objects and
appraisal scope, and the continuous increase of appraisal
practitioners, the self-discipline mechanism of the asset
appraisal industry self-regulatory management
organization has gradually been established and improved.
With the continuous accumulation of appraisers' appraisal
experience and experience, people's understanding of the
rules of asset appraisal has also been qualitatively
improved. In order to prevent risks in the asset appraisal

industry, maintain the social and professional reputation of
the appraisal industry, and unify appraisal practitioners’
knowledge and appraisal concepts, asset appraisal
professional organizations have formulated appraisal
professional ethics and norms, striving to unify
professional appraisal terms, appraisal principles, and
appraisal techniques. Regulations and appraisal
professional ethics, etc., and then form a unified asset
appraisal standard within a country or region.
V. CONCLUSION & LEGAL
LIABILITY FOR EVALUATION RESULTS
The appraiser must sign the completed appraisal
report and affix the official seal of the agency at the same
time. The asset appraisal agency and appraiser must pay
corresponding legal responsibilities for the signed asset
appraisal report.
REFERENCES
[1] Cao HB. (2012). Analysis of China's regional economic
growth differences and its influencing factors. Jilin
University.
[2] Jiang N. (2009). Asset appraisal. Dalian: Dongbei
University of Finance and Economics Press.
[3] Jiang N. (2004). Re-discussion on the selection of
value types in the asset appraisal standards-An explanation
of the value types in the "Basic Standards for Asset
Appraisal. China Assets Appraisal, 4, 12-17+6.
[4] Pu X C. (2007). Research on the institutional factors of
China's regional economic development differences. Fudan
University.
[5] Sun H. (2012). Research on the differential monetary
policy from the perspective of the coordinated development
of regional economy. Northeast Normal University.
[6] Yong X L. (2010). Problems and countermeasures in
the development of the appraisal industry in the western
region. China Assets Appraisal, 9, 26-27.
[7] Zhu J L. (2001). Analysis of the difference in China's
regional economic development. Tianjin University of
Finance and Economics.
[8] Zhang ZY. (2004). Give full play to the role of asset
appraisal in the market economy. China Assets Appraisal,
4, 11-12.
[9] Zhou R. (2002). Problems and countermeasures in the
development of asset appraisal industry in western regions.
Journal of Inner Mongolia University of Finance and
Economics, 1, 99-100.

A Summary of the Analysis of the Problems Existing in the Development of Asset Appraisal Industry in Western China

Recommended

Recommended

More Related Content

What's hot

What's hot (20)

Similar to A Summary of the Analysis of the Problems Existing in the Development of Asset Appraisal Industry in Western China

Similar to A Summary of the Analysis of the Problems Existing in the Development of Asset Appraisal Industry in Western China (20)

More from Dr. Amarjeet Singh

More from Dr. Amarjeet Singh (20)

Recently uploaded

Recently uploaded (20)

A Summary of the Analysis of the Problems Existing in the Development of Asset Appraisal Industry in Western China