Tracks

2002 ◽  
Vol 17 (4) ◽  
pp. 351-373 ◽  
Author(s):  
Marta Ballester ◽  
Joshua Livnat ◽  
Nishi Sinha
Keyword(s):  
Human Capital ◽  
Market Value ◽  
Capital Asset ◽  
Financial Reports ◽  
Book Value ◽  
Market Values ◽  
Residual Income Valuation ◽  
The Difference ◽  
Selective Disclosure

This study examines the selective disclosure of labor-related costs by U.S. firms and estimates the proportion of these costs that the market values as an investment in human capital. Labor-related costs are separately identified in the financial reports of only a small fraction of all U.S. Compustat firms. Larger firms, firms in industries that are regulated, are more labor-intensive, and have relatively little competition are more likely to report these costs voluntarily. Using a modification of the residual income valuation framework with a sample of firms that consistently disclosed their labor-related costs, the study finds that for these firms about 16 percent of all such costs represent an investment in human capital, and that about a third of this asset depreciates annually. Further, the human capital asset averages about 5 percent of the total market value of the firm and accounts for about 16 percent of the difference between market and book value. The ratio of the human capital asset to market value is found to be positively related to operating uncertainty, industry concentration, and industry-adjusted average compensation paid to employees. The human capital asset is also positively associated with analysts' long-term forecasts of earnings.

scholarly journals Capital Structure and the Value of Quoted Firms in Nigeria: A Test of Miller and Modigliani Irrelevant Hypothesis

2019 ◽  
Vol 3 (2) ◽  
pp. 1-15
Author(s):  
Uzokwe Grace Onyinyechi
Keyword(s):  
Capital Structure ◽  
Random Effects ◽  
Market Value ◽  
Annual Reports ◽  
Cross Sectional ◽  
Financial Reports ◽  
Beta Coefficient ◽  
Equity Ratio ◽  
Retained Earnings

This study tested an insignificant hypothesis of the capital structure of Miller and Modiglian in Nigeria. The aim was to investigate the validity of the irrelevant hypothesis. The Tobins Q market value measure was modeled as a function of debt-to-equity ratio, long-term debt to equity ratio, and retained earnings ratio. Twenty companies were selected on the basis of the information needed to conduct the survey and the availability of annual financial reports for the ten-year period 2008-2017. Cross-sectional data were obtained from the annual accounts and annual reports of the companies. Random effects were used in the analysis of fixed and random effects. The study showed that 77% volatility in market value can be predicted by the variation of independent variables in the regression model. The beta coefficient of the variables found that the debt-to-equity ratio, the long-term debt-to-equity ratio, the capital-to-earnings ratio is positively and significantly related to the market value of the selected listed companies. The study concludes that capital structure is relevant, unlike Miller's and Modiglian's irrelevant hypothesis. Therefore, it is recommended that managers ensure an adequate combination of capital and debt.

scholarly journals Pengaruh Modal Intelektual terhadap Kinerja Keuangan dan Nilai Pasar

2017 ◽  
Vol 6 (1) ◽  
pp. 59-74
Author(s):  
Dwi Artati
Keyword(s):  
Financial Performance ◽  
Intellectual Capital ◽  
Control Variable ◽  
Secondary Data ◽  
Market Value ◽  
Financial Statement ◽  
Financial Industry ◽  
Book Value ◽  
The Difference ◽  
One Way Anova

            This research aims to observe, analyze effect of intellectual capital (VAIC) to financial performance delegated by ROE and market value delegated by M/B (Market to Book Value Ratio), and test the difference intellectual capital (VACA, VAHU, STAVA) at manufacture, trading and financial industry. In addition to, this research observes difference indication of intellectual capital effect to financial performance and market value among manufacture, trading and financial industry. The sample which used was manufacture companies, trading and financial industries at BEI in 2011-2013. This research used company size as control variable delegated by asset. The method of data collecting was done by conducting documentation secondary data using the financial statement of manufacture, trading, and financial companies at BEI and other seconder data. The method of analyses which used weremultiple linier regression analyses, F test, t test, One Way Anova and chow test. The instrument statistik which used was SPSS 22. Based on the findings, it can be concluded that VACA and STAVA affect financial performance (ROE), whereas VAHU doesn’t. Then, VAHU affects market value, whereas VAHU and STAVA don’t. Furthermore, the test of difference of intellectual capital (VACA, VAHU, STAVA) at three companies, such as manufacture, trading and financial industries showed that there was a difference among them. Meanwhile, the verification showed that there is difference the effect of intellectual capital (VACA, VAHU, STAVA) to financial performance and market value.   Key words : intellectual capital, VACA, VAHU, STAVA, ROE, M/B, company standard

scholarly journals Cointegration Analysis among the Variables of the Ohlson Model for Brazilian Companies

2018 ◽  
Vol 4 (1) ◽  
pp. 125
Author(s):  
Júlio Pereira De Araújo ◽  
Marcos Roberto Gois De Oliveira Macedo
Keyword(s):  
Time Series ◽  
Explanatory Power ◽  
Panel Cointegration ◽  
Market Value ◽  
Listed Companies ◽  
Cointegration Analysis ◽  
Equilibrium Relation ◽  
Book Value ◽  
Ohlson Model

We examine whether there is a long-term equilibrium relation between the companies market value and the variables accounting book value and abnormal earnings based on the Ohlson model (1995) using a cointegration approach. Our panel cointegration analysis indicates that the variables cointegrate when using the whole sample, the most liquid companies group and for all sectors in at least one of the tests performed with exception of the Telecommunications sector, which presented no cointegration in both tests. The time series cointegration results have shown that, except for one company, for all the remaining the variables cointegrated. Therefore, the Ohlson Model (1995) is relevant for the evaluation of Brazilian listed companies in a long-term equilibrium. In addition, we provide evidence that abnormal earnings have limited explanatory power compared to book value.

scholarly journals Human Capital Investment Effects On Firm Returns

2011 ◽  
Vol 12 (1) ◽  
pp. 30 ◽  
Author(s):  
Marvin L. Bouillon ◽  
B. Michael Doran ◽  
Peter F. Orazem
Keyword(s):  
Human Capital ◽  
Capital Investment ◽  
Human Capital Investment ◽  
Market Value ◽  
Annual Reports ◽  
Common Stock ◽  
Net Income ◽  
Firm Investment ◽  
Book Value ◽  
Specific Human Capital

This paper demonstrates that two measures of firm investment in specific human capital are significantly and positively correlated with long-term rates of return on investment. The final sample of 260 firms is a subset of the 805 firms included in the June 1984 edition of Forbes survey of executive compensation. We utilize two proxies for firm return-net income and cash flow. The return measures are scaled by both book value of total assets and market value of common stock yielding four alternative specifications of the rate of return measure. The firm investment in specific human capital measures are generally found to be significant explanatory variables in the regressions that have returns scaled by book value of assets. These measures of investment are insignificant when market value of common stock outstanding is used to scale the return measures. We interpret these findings to imply that a public or regulatory policy needs to be established to require firms to include at least some basic rudimentary information regarding their human capital investment, such as turnover rates and training cots, in their annual reports.

The Value Relevance of Financial Statement Recognition vs. Disclosure: Evidence from SFAS No. 106

1999 ◽  
Vol 74 (4) ◽  
pp. 403-423 ◽  
Author(s):  
Paquita Y. Davis-Friday ◽  
L. Buky Folami ◽  
Chao-Shin Liu ◽  
H. Fred Mittelstaedt
Keyword(s):  
Value Relevance ◽  
Market Value ◽  
Financial Statements ◽  
The Body ◽  
Financial Statement ◽  
Financial Reports ◽  
Association Tests ◽  
Market Values ◽  
Value Association

This study examines whether the market values financial statement data differently if it is disclosed instead of recognized in the body of the financial statements. We identify a sample of 229 SFAS No. 106 adopters who disclose an estimate of their anticipated liability for retiree benefits other than pensions (PRB) in their financial reports prior to the year of recognition. We then test whether the disclosed estimate of the PRB liability is valued differently by the market than is the subsequently recognized PRB liability. We provide modest and model-sensitive evidence that the recognized PRB liability receives more weight than the disclosed liability in market value association tests.

Further Thoughts on Long-term Rates of Interest in the Valuation of a Pension Fund.

1987 ◽  
Vol 30 ◽  
pp. 117-140
Author(s):  
C. D. Daykin
Keyword(s):  
General Problem ◽  
Pension Fund ◽  
Market Value ◽  
Rate Of Return ◽  
Market Values ◽  
Reliable Indication

Daykin (1976) suggested a method of evaluating the rate of return achieved over a past period which did not depend directly on the market value at the end of the period in question. This was intended to avoid the volatility in the results of an assessment based on market values and sought to give a more reliable indication of the underlying rate of return which had been achieved. If the general problem in relation to equities is considered, an investment of 1 at the beginning of year M will roll up with reinvestment of dividends to give an accumulated investment, XN , at the end of year N, in terms of ‘units’ in an index P, of: (1)

The Difference That CEOs Make: An Assignment Model Approach

2008 ◽  
Vol 98 (3) ◽  
pp. 642-668 ◽  
Author(s):  
Marko Terviö
Keyword(s):  
Competitive Equilibrium ◽  
Economic Value ◽  
Market Value ◽  
Firm Characteristics ◽  
Managerial Ability ◽  
Market Values ◽  
Assignment Model ◽  
Ceo Pay ◽  
The Difference ◽  
Model Approach

This paper presents an assignment model of CEOs and firms. The distributions of CEO pay levels and firms' market values are analyzed as the competitive equilibrium of a matching market where talents, as well as CEO positions, are scarce. It is shown how the observed joint distribution of CEO pay and market value can then be used to infer the economic value of underlying ability differences. The variation in CEO pay is found to be mostly due to variation in firm characteristics, whereas implied differences in managerial ability are small and make relatively little difference to shareholder value. (JEL G32, M12, M52)

scholarly journals GAMBARAN NILAI PASAR TERHADAP RETURN SAHAM PADA PERUSAHAAN SUBSEKTOR ADVERTISING PRINTING MEDIA YANG TERDAFTAR DI BEI PERIODE 2010-2016

2018 ◽  
Vol 3 (2) ◽  
pp. 142-152
Author(s):  
Prisila Destiana ◽  
Ahim Surachim ◽  
Sulastri Sulastri
Keyword(s):  
Research Result ◽  
Secondary Data ◽  
Market Value ◽  
Book Value ◽  
Analysis Technique ◽  
Verification Methods ◽  
Approach Method ◽  
The Difference ◽  
Research Period ◽  
Positive Effect

Purpose - The purpose of this research are to descript of market value, the descript of stock return, while the purpose of this study is to determine the description of perception market value to return saham in subsector advertising printing media.Design / methodology / approach - Method in this research used descriptive and verification methods. Data that used are secondary data of each subsector advertising printing media with analysis technique using multiple linear regression. Sampling in this research use purposive sampling.Findings - The results of this research indicate that market value measured by Price Earning Ratio (PER) and Price to Book Value (PBV) has significance to return saham. The result showed that the market value  has a positive  effect return saham.Originality -The difference of this research with previous research is on research object, population and research sample, research period, measuring instrument and research result, as well as foreign theory and journal source and foreign book and research result.

Accounting and analytical aspects of the value of human capital of the enterprise

2017 ◽  
Vol 31 (2) ◽  
pp. 163-169
Author(s):  
A. I. Linev
Keyword(s):  
Human Capital ◽  
Intellectual Development ◽  
System Analysis ◽  
Market Value ◽  
Book Value ◽  
Highly Educated ◽  
Study Results ◽  
Intellectual Assets ◽  
Modern Business ◽  
Intellectual Potential

Object. Modern business - is highly complex, constantly changing system that requires a deep rethinking and measurement. The success and stability in business development comes only to those enterprises, which realized, develop and implement innovative projects. At the same time rely on individual intellectual development worker to the enterprise is not necessary, a reference to this situation is the implementation of innovative projects requiring «intelligent enterprise». Intelligent Enterprise - is a technologically advanced information and an enterprise carried on by a competent, highly skilled and highly educated personnel. Subject. The relevance of the article due to the fact that human capital is an important resource activities of any business entity. Goal. Author's research is aimed at studying accounting and analytical aspects of an enterprise value of human capital at the present time. Development of a qualitatively new approach to the problem focused on «intelligent enterprise». The main feature of «intelligent enterprise» - the company's market capitalization in excess of the book value of its resources. Methodology. The study challenges the registration-analytical aspects of human capital value of the enterprise used the methods of morphological analysis, typologies, techniques logistic data link, the system analysis. Results. There is a problem of underestimating the intellectual potential of the enterprise. Practice has proved that the complexity of assessing the market value of any company in the transaction of purchase and sale is caused by the fact that the market value of most companies is different from the book value. This is due to the fact that most businesses are not able to reliably estimate their intellectual assets, ie the value of human capital. Scope of the study results. All sectors of activity. Conclusions. Proper and adequate assessment of the value of the company is necessary as external stakeholders (the formation of its value), as well as with internal stakeholders (effective management). This problem is solved provided reliable accounting and reflection of human capital (intellectual potential).

scholarly journals What drives the value of football clubs: An approach based on private and socio-emotional benefits

2016 ◽  
Vol 14 (1) ◽  
pp. 673-683 ◽  
Author(s):  
Riccardo Tiscini ◽  
Alberto Dello Strologo
Keyword(s):  
Empirical Analysis ◽  
Market Value ◽  
Theoretical Explanation ◽  
Private Benefits ◽  
Business Valuation ◽  
Book Value ◽  
Private Benefits Of Control ◽  
Operating Profit ◽  
Football Clubs ◽  
The Difference

The present paper shows how, in the soccer clubs sector, where the average financial results are negative, the value of football clubs is not related to income, but to sales turnover and gives a theoretical explanation for that. The literature has shown that the profitability of the industry is generally negative already at the level of operating profit. However, the difference between market value and book value is broadly positive, showing that the market recognizes to these companies a quid pluris in terms of value, not explained by the most rational and generally accepted methods of business valuation. The present study aims to explain, through an empirical analysis, why the value of a football company can not be estimated only on the basis of expected financial results, but it requires considering the overall benefits for shareholders, represented also by private benefits of control and socio-emotional benefits.

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