scholarly journals The Comparative Value Relevance of Accounting Earnings, Book Value, Net Cash Flows, Operating Income, and Net Operating Cash Flows in Listed Korean Stock Markets

2015 ◽  
Vol null (62) ◽  
pp. 165-188 ◽  
Author(s):  
Kwon Gee Jung
Keyword(s):  
Stock Markets ◽  
Value Relevance ◽  
Cash Flows ◽  
Accounting Earnings ◽  
Operating Income ◽  
Book Value ◽  
Operating Cash Flows ◽  
Value Net

Comparative value relevance of accounting information among Asian countries

2018 ◽  
Vol 44 (2) ◽  
pp. 110-126 ◽  
Author(s):  
Gee-Jung Kwon
Keyword(s):  
Cash Flow ◽  
Value Relevance ◽  
Accounting Information ◽  
Asian Countries ◽  
Accounting Earnings ◽  
Content Type ◽  
Operating Income ◽  
Book Value ◽  
Operating Cash Flow ◽  
Japan And China

Purpose The purpose of this paper is to compare the value relevance of various accounting information disclosed in financial statements of manufacturing companies listed on the stock markets of Korea, Japan, and China over ten years from 2006 to 2015. Design/methodology/approach The study uses Ohlson (1995) valuation model for empirical investigation and the financial data extracted from the OSIRIS DB to analyze the enterprise value relevance of accounting information for Korean, Chinese, and Japanese companies and to investigate the differences among them. Findings The results of the empirical analysis are as follows. First, the coefficient of accounting earnings is the highest in the samples of all firms in Korea, Japan, and China, followed by the coefficients for operating income, net cash flow, book value, and net operating cash flows. Next, Japan has the largest book value, followed by Korea, but China has a negative value. Japan has the largest coefficient of accounting earnings and net operating cash flow, followed by Korea and China. Japan has the largest coefficient of net cash flow and operating income, followed by China and Korea. The results show that the value relevance of accounting earnings is the largest among independent variables related to firm value, but the net operating cash flow is the smallest. In addition, the authors observe that the coefficient of Japan is the largest of all independent variables when compared by country. Originality/value The contribution of this study is that it shows the comparative value relevance of accounting information in most economically developed Asian countries such as Korea, Japan, and China. In addition, it is worth showing the characteristics of the national value decision variable by showing different incremental value relevance levels among the three countries.

Future Profitability, Operating Cash Flows, and Market Valuations Associated with Offshoring Arrangements of Technology Jobs

2009 ◽  
Vol 23 (2) ◽  
pp. 25-47 ◽  
Author(s):  
Kimberly Dunn ◽  
Mark Kohlbeck ◽  
Matthew Magilke
Keyword(s):  
Economies Of Scale ◽  
Value Relevance ◽  
Relative Size ◽  
Cash Flows ◽  
Labor Costs ◽  
Business Operations ◽  
Operating Cash Flows ◽  
Potential Benefits ◽  
Market Valuations ◽  
The Impact

ABSTRACT: We investigate profitability, operating cash flows, and value relevance associated with offshoring arrangements of technology-oriented jobs. Offshoring is the business practice of moving substantial portions of a firm's business operations (and jobs) to another country usually to take advantage of lower labor costs or other production factors in developing countries. Offshoring carries social costs as local jobs are lost which may limit realization of benefits. We find that firms that offshore technology-oriented jobs report greater earnings and operating cash flows following an offshoring event as the relative size of the offshoring arrangement increases. Consistent with these results, the market only values offshoring beyond the impact recognized in the financial statements for larger offshoring arrangements. A valuation discount actually exists for smaller offshoring arrangements suggesting either (1) costs exceed potential benefits or (2) the perception that benefits are only realized through economies of scale. We document both benefits and costs that are important for those firms considering offshoring arrangements and their stakeholders.

scholarly journals A comparative study of information content of cash flow, cash value added, accounting earnings, and market value added to book value of total assets in evaluating the firm performance

2017 ◽  
Vol 5 (2) ◽  
pp. 112
Author(s):  
Mohammad Delkhosh ◽  
Zahra Malek ◽  
Maryam Rahimi ◽  
Zohreh Farokhi
Keyword(s):  
Firm Performance ◽  
Information Content ◽  
Financial Reporting ◽  
Value Added ◽  
Market Value ◽  
Cash Flows ◽  
Maximum Information ◽  
Book Value ◽  
Operating Cash Flows ◽  
Market Value Added

The aim of the present study was to compare the utility of traditional accounting reporting and financial reporting for performance evaluations. Accordingly, the relationship between six ratios of net cash flows, net operating cash flows, cash value added, income after tax, income before tax, and market value added to the book value of total assets and Tobin’s Q ratio as an indicator of performance evaluation were examined. For this purpose, the information of 122 companies listed on Tehran Stock Exchange in the years 2009 to 2014 were used. Besides, linear regression and analysis of variance (ANOVA) were used to analyze the data. The results showed that except for the ratio of net cash flows to the book value of total assets, there was a significant relationship between the other five ratios. In addition, it was noted that cash value added to net operating cash flows had more information content concerning evaluating the firm performance. The results also indicated that net cash flows did not contain information content for evaluating the firm performance. However, the market value added had the maximum information to be used for evaluating the firm performance.

Revisiting the Value Relevance of Accounting Information in the Italian and UK Stock Markets

2017 ◽  
pp. 102-113
Author(s):  
James A. Rossi
Keyword(s):  
Financial Markets ◽  
Stock Markets ◽  
Value Relevance ◽  
Accounting Information ◽  
Cash Flows ◽  
Reliability Of Results ◽  
Accounting Data ◽  
The Uk ◽  
Relevance And Reliability

This chapter aims to investigate the results of the value relevance of accounting information with reference to the study: “The value relevance of accounting information in the Italian and UK stock markets”. Results revealed from this study are as follows: - First, evidence shows the greater value relevance of accounting information in Italy than in the UK, even if this result must be explained according to the sample's characteristics. Second, the study underlines that in Italy the most value relevant accounting data refer to earnings while in the UK the focus is mainly on cash flows. The chapter also seeks to contribute to the gap in the literature on the value relevance of accounting information in the UK and Italy. In so doing it investigates the relevance and reliability of results derived in this study, their applicability to current market developments – as well as recent fluctuations and volatility in the financial markets.

The value‐relevance of earnings and operating cash flows during mergers

2004 ◽  
Vol 30 (11) ◽  
pp. 16-29 ◽  
Author(s):  
Cal Christian ◽  
Jefferson P. Jones
Keyword(s):  
Value Relevance ◽  
Cash Flows ◽  
Operating Cash Flows

Earnings persistence and stock prices: empirical evidence from an emerging market

2014 ◽  
Vol 12 (2) ◽  
pp. 117-134 ◽  
Author(s):  
Varun Dawar
Keyword(s):  
Stock Prices ◽  
Value Relevance ◽  
Emerging Market ◽  
Cash Flows ◽  
Earnings Persistence ◽  
Market Prices ◽  
Content Type ◽  
Book Value ◽  
Panel Data Regression ◽  
Data Regression

Purpose – This study aims to investigate the persistence ability of accounting variables, namely, abnormal earnings, book value, accruals and cash flows over a period of time and their valuation relevance in Indian scenario. Design/methodology/approach – The study utilizes the generalized version of the Ohlson model which links market prices with abnormal earnings, book value and earning components (accruals and cash flows). Fixed-effect panel data regression is used to analyze six years of data on the sample units to determine the persistence and valuation relevance. Findings – The findings provide evidence on the construct of persistence and value relevance of earnings and book value of equity in the Indian context. The findings further confirm that investors in India are fixated on earnings and fail to attend separately to the cash flow and accrual components of earnings while undertaking their investment decisions. Practical implications – The empirical findings of the study will enable the analysts and investors to understand the relevance and persistence of accounting variables in case of an emerging market like India. Originality/value – The study extends the extant literature on value relevance studies in developed markets to an emerging market like India and enriches it in several ways.

Which Performance Measures Do Investors Around the World Value the Most—and Why?

2010 ◽  
Vol 85 (3) ◽  
pp. 753-789 ◽  
Author(s):  
Jan Barton ◽  
Thomas Bowe Hansen ◽  
Grace Pownall
Keyword(s):  
Performance Measures ◽  
Value Relevance ◽  
Earnings Quality ◽  
Cash Flows ◽  
Performance Measure ◽  
Single Measure ◽  
Operating Cash Flows ◽  
The World ◽  
Principal Factors ◽  
Highly Correlated

ABSTRACT: We examine the value relevance of a comprehensive set of summary performance measures including sales, earnings, comprehensive income, and operating cash flows. We find that, while value relevance peaks for measures “above the line,” no single measure dominates around the world. Instead, a measure is more relevant when it captures, directly and quickly, information about firms’ cash flows. Specifically, for each performance measure by country, we estimate eight attributes commonly used to assess earnings quality. We find these attributes highly correlated—most of their variance is explained by only two principal factors. A factor capturing articulation with cash flows is positively associated with a measure’s value relevance; a factor reflecting the measure’s persistence, predictability, smoothness, and conservatism is negatively associated. Our results suggest that, when it comes to equity valuation, accounting researchers and standard-setters should focus not on what performance measure is “best” at a given point in time, but on the underlying attributes that investors find most relevant.

scholarly journals PENGARUH LABA AKUNTANSI & ARUS KAS OPERASI TERHADAP KEPUTUSAN INVESTASI (RETURN SAHAM)

2021 ◽  
Vol 3 (2) ◽  
pp. 147-170
Author(s):  
M. Rinto Ananta Pintarto ◽  
Pujiono Pujiono
Keyword(s):  
Linear Regression ◽  
Stock Returns ◽  
Accounting Information ◽  
Investment Decisions ◽  
Financial Statements ◽  
Cash Flows ◽  
Accounting Earnings ◽  
Operating Cash Flows ◽  
Regression Test ◽  
Operating Cash Flow

This study aimed to examine the market reaction to the publication of accounting information in the form of profits and operating cash flows associated with investment decisions.  As a proxy of investment decisions is stock returns in banking companies at the time of publication of financial statements.  The technique applied in this research is purposive sampling, obtained as many as 114 data (from 38 companies for 3 years). Using the SPSS tool.  The method used in this research is non-linear regression test.  The results of the study show that accounting earnings have an effect on investment decisions (stock returns), meanwhile operating cash flows doesn’t have any effect on investment decisions (stock returns).  Therefore, it is recommended for investors to pay more attention to accounting income statements than operating cash flows to sort out stocks itself. keywords: accounting income, operating cash flow, stock returns, investment decisions.

Sign in / Sign up

Export Citation Format

Share Document