Investigation of Value Relevance of Cash Flows, Current Accruals and Non-current Accruals relative to the Value Relevance of Earnings
Journal Title: International Research Journal of Applied and Basic Sciences - Year 2013, Vol 5, Issue 6
Abstract
Useful information is the base of decisions by people who are participating in the capital market. Determiners of accounting standards try to provide financial reporting and information needs of the accounting systems of the capital markets. Therefore, evaluating the usefulness of accounting information in stock value or relevance of accounting information in company value, which has been paying much attention in recent researches, has been discussed as a role model in the research of financial accounting. In this study, the content of various classified information benefits, including a combination of operating cash flow measurements, current accruals, non-current accruals, is paid in four models to propose an optimization model for classifying the information content of accounting earnings components. To test research hypothesis, statistical method of data combination, with the use of financial data of 103 listed companies in Tehran Security Exchange during the years of 2005 to 2010, has been used. The findings of the research show that as the earnings is changed into smaller parts, the changes in market value will be further clarified, i.e. the market value of the prediction error is decreased. On the other hand, the results show that operating cash flow compared with the ratio of total accruals, current accruals contain more information and the current accruals of earnings have incremental value relevance to non-current accruals.
Authors and Affiliations
Fereshteh Tavan| Department Of Accounting, Science And Research Branch, Islamic Azad University, Khouzestan, Iran, email: fereshteh.tavan0917@gmail.com, Vali Khodadadi| Department Of Accounting, Science And Research Branch, Islamic Azad University, Khouzestan, Iran, Alireza Jorjorzade| Department Of Accounting, Science And Research Branch, Islamic Azad University, Khouzestan, Iran
Keywords
Related Articles
- EP ID EP5959
- DOI -
- Views 223
- Downloads 7
The examination of the relationship between the book value and the enterprise value in financially stressed firms (with serious financial problems)
As a market, the stock exchange provides the required information to the buyers and the sellers of the securities. At any moment, the investors can change their money to the securities and vice versa. On the other hand,...
The Effect of accounting earnings on stock prices of firms listed in Tehran stock exchange (2009 to 2011 years)
Our investigation sample comprises of data from 44 companies in Iran during the time period of 1388-1390. The dependent variable of the stock price is the variable of accounting profit. Data has been collected from theor...
Investigation of plants purification capability of Pb on two cultivars of vetch plants(VignaRadiata) in contaminated soils
Vetch plant ( VignaRadiata) is a diploid plant with 2n=2z=22 chromosomes. It is a valuable legume and plays a major role in the nutrition of people of little income in the developing countries, as it is a rich source of...
Comparative Study of Minority Rights in Iran and International Law
Observing Minority rights and do not discriminate against them is the issue that is considered and discussed in human rights organizations that consider Arrangements to rights of minorities and prepare peaceful coexisten...
The Effect of Attentional-Focus Instruction on Peripheral Transfer from Dominant Hand to Non- Dominant Hand and Vice Versa in Basketball Dribbling
The aim of the present study was to investigate the effect of focus of attention (external, internal) on peripheral transfer of basketball dribbling. Recent researches have shown that the focus of attention plays an impo...