Company's Characteristics and Accounting Information Relevance

Abstract

The paper examines whether company's characteristics, namely, stockholders number, listing status and company's age affect its accounting information relevance and which stock price measure, among average price, closing price and after three months price, is more dependable in pointing out the accounting information value relevance for a sample consists of 91 companies in the services and industrial sectors in Jordan within 2004-2013. Using price model, it is found that companies with larger stockholder numbers, listed on Amman Stock Exchange primary market, and that are older in age yield greater value relevance for per share earnings and book value. Book value has the greatest value relevance being the best predictor for firm value, while cash flows showed insignificant results. Finally, we concluded that closing price is the most dependable among the three stock price measures in detecting the accounting information value relevance in Jordan. The paper presents the ability of valuation theory/model to interact with other theories by including the effect of non-accounting information on the accounting information value relevance. Our findings might present evidence that can serve the educational institutions in their courses and provide a guideline to investors, managers and financial analysts to better summarize the firm value.

Economic Factor and Value Relevance of Accounting Information in Bangladesh

“…The company's size and leverage are the paper's control variables. Following previous literature (Anandarajan & Hasan, 2010;Shamki & Alulis, 2016;Jabar, 2012;Shamki, 2012 and) the present study controlled firm size while looking at the value relevance of the accounting information. This is authentic, in light of the fact that large companies have large accounting variables then huge profit, book worth, and incomes.…”

Factors Affecting The Use Of Accounting Information With Environmental Uncertainty As A Moderating Variable

“…According to (Lasdi & Mulia, 2014); (Ponisciakova et al, 2015); (Shamki & Alulis, 2016) The use of accounting information has a good impact on decision-making and performance improvement. In line with the theory, namely the theory of motivation that supports MSMEs to use information systems.…”

The Impact of COVID-19 on Financial Statements Results and Disclosure: First Insights from Italian Listed Companies

“…As we know, the recipients of financial information are not the only subjects who put liquidity into the company (otherwise known as capital providers 13 ) but, more broadly, they encompass all the stakeholders, who must be enabled to appreciate the solvency and the liquidity of the company from a forward-looking perspective 14 . Relevant information comprises what readers need to evaluate a company's value and make decisions [31].…”

“…The Author also emphasizes that the richness of the information content of the financial statements for its multiple recipients is demonstrated by the fact that this type of document lends itself to various reworkings that lead to further and different ways of representing the results. could affect the opinion of stakeholders and, at the same time, prevent financial statements from fully covering the needs of investors 15 , there would be a risk of an influence on the quality of financial information [11,12]; this is related to the fact that financial statements are not the only font of information which leads investors to seek relevant information from other sources [31]. The statement of information is considered relevant when its omission or incorrect indication could reactively influence the decisions taken by users on the basis of the company financial statements (Art.…”