scholarly journals The Value Relevance of Accounting Information: An Empirical Analysis of Banking Sector of Pakistan

2019 ◽  
Vol 1 (2) ◽  
pp. 10-17
Author(s):  
Shahida Perveen
Keyword(s):  
Business Performance ◽  
Banking Sector ◽  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Strong Relationship ◽  
Financial Statements ◽  
Share Price ◽  
Data Set ◽  
Average Share

Accounting Information contained in financial statements is relevant & reliable enough to present an indication of a business performance and financial condition to decision makers including investors.  This study attempts to address the value relevance of accounting information in investor’s decisions in Pakistani stock market. The relevance of accounting information is measured via correlation coefficient between average share price and cluster analysis is used to investigate the value relevance of large size firms and small size banks, further more incremental analysis and redundant variable test is also performed to check out the contribution of each variable in the model. Selective accounting information measures such as earning per share, equity, operational profit, size and age of firm, economic growth and non-traditional activities. Data set in this study consists of accounting information from published financial statements of commercial banks listed at Karachi Stock Exchange for a period of 6 years from 2007 to 2012.  The result shows that there is a strong relationship between accounting information and average share price. The most important value relevant variables are EPS, firm size and operational profit. The investors consider these instruments for investment decisions. All these variables are significant and value relevant. Hence, accounting information is value relevant in Pakistani financial market.

scholarly journals RELEVANSI NILAI LEVERAGE, DIVIDEN, DAN PROFITABILITAS TERHADAP HARGA SAHAM PADA PERUSAHAAN-PERUSAHAAN MANUFAKTUR YANG TERDAFTAR DI BEI PERIODE 2014-2016

2018 ◽  
Vol 7 (1) ◽  
Author(s):  
Ericson Wijaya, Amelia Sandra
Keyword(s):  
Stock Prices ◽  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Financial Statements ◽  
Share Price ◽  
Financial Statement ◽  
Actual Condition ◽  
A Value

Financial statements that have good value relevance can be a benchmark for an enterprise's value increase that can increase stock prices. Accounting information in the form of financial statements is expected to describe the actual condition of the company. Accounting information such as financial statement hopefully can describe the actual condition of the company.This research aims to analyze the influence of the value relevance of accounting information contained in leverage, dividend, and profitability to stock prices. Clean surplus theory is talking about predicting and analyzes function of financial statement. Market efficient theory is talking about quality of the information itself. And signaling theory is talking about how the information impacts the community. The object of this study was 25 companies who registered in manufacturing industries that listed at Indonesia Stock Exchange for the year 2014-2016. Tools that be used for data analysis in this research are pooling, classical assumption, statistic descriptive test, F-test, t-test, and coefficient determination of R square by using SPSS 20.0 . This research shows that leverage doesn’t have a value relevance to the share price, dividend doesn’t have a value relevance to the share price, and profitability has a value relevance to the share price. Keyword : Value Relevance, Leverage, Dividend, Profitability

scholarly journals Association between Accounting Numbers and Value of Food and Beverages Firms in Nigeria

2015 ◽  
Vol 7 (12) ◽  
pp. 245
Author(s):  
Nyor Terzungwe ◽  
Nasiru Rabiu
Keyword(s):  
Value Relevance ◽  
Stock Exchange ◽  
Investment Decision ◽  
Market Price ◽  
Accounting Information ◽  
Financial Statements ◽  
Annual Reports ◽  
Market Values ◽  
Food And Beverages ◽  
Accounting Numbers

<p>The degree of statistical relationship between the contents of financial statements and market price of equity is what is termed Value relevance of accounting information. It explains stock market measures using financial information variables and it is a very useful guide to investors in pricing of shares. This study examines the extent of association between accounting information variables of earnings, dividend and book value of equity and market value of listed Food and Beverages firms in Nigeria. Data were collected from the published annual reports of the sampled firms and their market values obtained from the official daily list of the Nigerian Stock Exchange (NSE) over a period of 10 years (2001-2010). Using multivariate regression as technique for data analysis, the study established that accounting information of Food &amp; Beverages companies in Nigeria is value relevant. Accordingly, the study recommends the use of financial statements figures of Food and Beverages firms for investment decision.</p>

scholarly journals RELEVANSI NILAI INFORMASI AKUNTANSI ALTERNATIF SERTA IMPLIKASINYA TERHADAP PROSES PENGAMBILAN KEPUTUSAN INVESTASI DENGAN MENGGUNAKAN SEQUENTIAL EXPLANATORY MIXED METHOD

2020 ◽  
Vol 3 (1) ◽  
pp. 87
Author(s):  
Mada Purwanto Wahyu Nugroho ◽  
Ahmad Syifaudin
Keyword(s):  
Mixed Method ◽  
Stock Prices ◽  
Stock Price ◽  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Financial Statements ◽  
Sources Of Information ◽  
Sequential Explanatory Mixed Method ◽  
Sequential Explanatory

Distortion of information is one of the inherent accounting risks in financial statements. Financial statements are one of the fundamental sources of information that can be used in investment decision making in the Indonesia stock exchange. If investors use this information, then investors also have the same risk that is the distortion of information contained in financial statements. This research tries to test whether stock prices can be more explained through alternative accounting information or information contained in financial statements. This research was conducted using a sequential explanatory mixed method. Using data on companies listed in the Business 27 index, tested using path analysis through multiple regression models, the results of this research indicate that alternative accounting information has not been able to explain variations in stock price changes compared to accounting information contained in financial statements. Meanwhile, the results of the analysis using qualitative data indicate there is a match between the results of quantitative analysis and qualitative analysis. Keywords: Value Relevance; Alternative Accounting Information; Investment Decisions

scholarly journals The impact of the Law on Strengthening the Security of Financial Relations on the value relevance of accounting information in Tunisian Stock Exchange

2013 ◽  
Vol 3 (1) ◽  
pp. 42
Author(s):  
Mohamed Rafik Ben Ayed ◽  
Ezzeddine Abaoub
Keyword(s):  
Stock Returns ◽  
Value Relevance ◽  
Stock Exchange ◽  
Explanatory Power ◽  
Accounting Information ◽  
Financial Statements ◽  
Accounting Earnings ◽  
The Law ◽  
Security Returns ◽  
The Impact

This paper empirically investigates the value relevance of accounting earnings measures in the emerging capital market of Tunisia. The issue is tested by estimating the regression of annual security returns on different earnings measures extracted from income statements. In Tunisia, firms prepare their financial statements in accordance with Tunisian Accounting Standards (TAS) which are inspired from International Financial Reporting Standards (IFRS). Based on a sample of 389 firm years for firms listed on the Tunis Stock Exchange (TSE) during the period 1997-2008 and using pooled regressions, we find that accounting earnings measures are weakly related to security returns. However, we find that earnings before taxes has the higher explanatory power for stock returns. This is perhaps due to the fact that financial statements are often influenced by taxation rules (ROSC, 2006; section 42). Further, we find that cash flow from operations and Total accruals are not value relevant for valuation. We tested whether the value relevance of each measure of performance improved after the adoption in October 2005 of the Law on Strengthening the Security of Financial Relations (LSSFR). Consistent with prior US and other international findings, results show that the explanatory power and the magnitude of the slope coefficient of each measure increased when we take into account for the impact of this enactment. However, the increase is not statistically significant. This is perhaps due to the employed specification of the relation between security returns and accounting information.

scholarly journals VALUE RELEVANCE OF ACCOUNTING INFORMATION AND SHARE PRICE: AN EMPIRICAL STUDY ON MANUFACTURING FIRMS IN NIGERIA

2020 ◽  
pp. 64-77
Author(s):  
OC Ogbodo ◽  
Benjamin Osisioma
Keyword(s):  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Manufacturing Firms ◽  
Least Square ◽  
Share Price ◽  
Manufacturing Companies ◽  
Causality Test ◽  
Ex Post ◽  
Ex Post Facto

This study assessed the relationship between the value relevance of accounting information and share price with a focus on manufacturing companies listed on the Nigerian Stock Exchange (NSE). The Ex-post facto research design was used. Ordinary Least Square (OLS) regression analysis and Granger Causality test was used to test the hypothesis with the aid of E-View 9.0. The results of this study revealed that there is a significant positive relationship between Dividend per Share and the Share Price. The researcher recommends among others that standard setters, the stock market regulators and listed manufacturing firms in Nigeria should continuously devise ways of improving the quality of accounting information published in financial statements to maintain and increase their value relevance to the investors and other stakeholders.

scholarly journals i, The Impact of Adoption of IFRS 9 on the Value Relevance Accounting Information for the Companies Listed in ISX

2021 ◽  
Vol 11 (3) ◽  
Author(s):  
Prof Dr Bushra Najem Aubdullah Al- Mashhadan ◽  
Prof Dr Bushra Najem Aubdullah Al- Mashhadan
Keyword(s):  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Financial Statements ◽  
Book Value ◽  
Earnings Information ◽  
Income Statement ◽  
Ifrs 9 ◽  
The Impact ◽  
The Relationship

This research aims to know the effect of adopting IFRS 9 on the relevance of the value of the accounting information of the companies in the Iraqi Stock Exchange. Researchers relied on analyzing the financial statements of 10 listed companies for years 2016 – 2019. Researchers used the Ohlson price model to test the relationship between accounting information and value relevance. The research indicated that there is a significant relationship between the adoption of IFRS 9 and the relevance of the value of the earnings and the book value, but the earnings information is more relevance than the book value information, it is due to the interest of investors in the income statement in making investment decisions.

scholarly journals Value relevance of Accounting Information and its Impact on Stock Prices: Case Study of Listed Banks at Karachi Stock Exchange

2014 ◽  
Vol 1 (3) ◽  
pp. 6-9 ◽  
Author(s):  
Khurram Shehzad ◽  
Aisha Ismail
Keyword(s):  
Stock Prices ◽  
Stock Price ◽  
Banking Sector ◽  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Relevant Information ◽  
Accounting Data ◽  
Economic Decisions ◽  
Future Events

This study primary investigates the value relevance of accounting information in banking sector of Pakistan. The study employed the pooled regression technique on nineteen private banks from the period of 2008 to 2012. The findings show that earning per share is more value relevant than book values, while accounting data explains a high proportion of the stock price. The relevant information is such that it influences the economic decisions of users by helping them evaluate past, present and future events.

scholarly journals RELEVANSI NILAI INFORMASI AKUNTANSI TERHADAP HARGA SAHAM YANG DIMODERASI KONSERVATISME AKUNTANSI

2019 ◽  
Vol 7 (2) ◽  
Author(s):  
Margareta Chaslim, Carmel Meiden
Keyword(s):  
Stock Price ◽  
Value Relevance ◽  
Stock Exchange ◽  
Linear Regression Analysis ◽  
Accounting Information ◽  
Financial Statements ◽  
Multiple Linear Regression Analysis ◽  
Accounting Conservatism ◽  
Analysis Techniques ◽  
The Impact

An information content of the published financial statements is said to have value relevance if it is able to revise investor beliefs as reflected in market reaction through stock price changes. Nevertheless, many issues suggest that the value relevance of accounting information has declined, mainly due to the increasing practices of conservatism. This research purpose is to know and  prove the value relevance of accounting information and the impact of conservatism on the value relevance of the manufacturing firms listing in the Indonesian Stock Exchange in the period of 2013-2016. The sample used amounted to 320 observations consisting of 80 companies each year. Based on data analysis techniques with multiple linear regression analysis, it was found that accounting information proved to have value relevance to the stock price, as well as accounting conservatism have a different effect on each accounting information.Keywords: Value relevance, accounting information, stock price, conservatism

scholarly journals Value Relevance of Accounting Information in the Botswana Listed Companies

2020 ◽  
Vol 13 (5) ◽  
pp. 46
Author(s):  
Christian J. Mbekomize ◽  
Selinkie Popo
Keyword(s):  
Market Share ◽  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Cash Flows ◽  
Least Square ◽  
Share Price ◽  
Annual Reports ◽  
Book Value ◽  
Share Prices

The main purpose of the study was to examine the statistical relationship between four sets of accounting information and market share prices using the data of companies listed on the Botswana Stock Exchange over the period from 2012 to 2018. Annual reports and Botswana Stock Exchange &ndash; Equity Statistics data bank were the sources of accounting information and market prices respectively. The Ordinary Least Square regression method was used to analyse data. The results suggest that earnings are the most value relevant information to share prices followed by dividends and lastly book value. While book value yielded weak value relevance operating cash flows did not explain changes in share prices in the Botswana equity market. The combination of earnings and dividends was more value relevant than any other mix of accounting amounts. The study further revealed that the market share price at the end of the 6th month from the year end was the most influenced price. These results have implications to quoted companies regarding the importance they attach on earnings and dividends information and their timely publication. The paper recommends for speedy dissemination of earnings and dividends information since investors significantly consider such information in market share pricing decisions.

scholarly journals RELEVANSI NILAI INFORMASI AKUNTANSI DI BURSA EFEK INDONESIA

2019 ◽  
Vol 5 (2) ◽  
pp. 101
Author(s):  
Susi Dwimulyani
Keyword(s):  
Value Relevance ◽  
Stock Exchange ◽  
Accounting Information ◽  
Strong Relationship ◽  
Fair Value ◽  
Multiple Regression Equation ◽  
P Value ◽  
Cross Sectional ◽  
Operating Income ◽  
Book Value

<p class="Style1"><em>This research is designed to examine the value relevance of accounting information at Indonesian Stock Exchange for 2003-2007. Research samples were selected from all of emitent listing in Indonesian Stock Exchange from 2003 — 2007. For hypotesis testing were used Francis and Schipper, and Brown model. There were two multiple regression equation. The research sample are all listed companies at Indonesian Stock Exchange for 2003-2007 that had publised financial statements at December 31. Based on E-Views program, it was found first cross sectional regression : p-value 0,00 and average R</em><em><sup>2</sup> 0,5637, it means that there was strong relationship between fair value of companies and its book value. The second regression was found that p-value 0,00 and average R</em><em><sup>2</sup> 0,8458, it means that there was strong relationship between book value equity of companies and its operating income. Based on statistical calculation, it was concluded that value relevance of accounting information was very important for investor and creditor for their decision.</em></p>

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