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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.

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.

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.

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.

This study aimed at investigating the value relevance of book value and earnings and the relationship between earnings and operating cash flow of two different financial reporting regimes in Malaysia. A market and nonmarket valuation approaches were utilised for that purpose. The result of market valuation approach of pool sample shows that book values and earnings are value relevant. We also observed that the change in financial reporting regime affects significantly the value relevance of book value and but not earnings. While book value and earnings are value relevant during the MASB period, only book value is value relevance during the FRS period. The result of non‐market valuation approach on the other hand, shows that the change in financial reporting regime has no significant effect on the relationship between earnings and operating cash flow. The result of market valuation approach implicates that the introduction of new or improved standards under FRS regime strengthen the position of book value thus leaving earnings behind in equity valuation. The result of non‐market valuation model implicates that the level of relationship between earnings and operating cash flow persists as long as operating cash flow comprise of cash and cash equivalent components whereas earnings comprise of cash and accruals components. The study contributes to the existing literature in the area of the effect of adoption of FRS on value relevance of accounting numbers in Malaysia.

Motivated by the lack of research on the value relevance of accounting information in the emerging markets of Middle Eastern countries, and the unique institutional and accounting setting in Egypt, this paper aims to investigate the relation between capital market and accounting information in the emerging market of Egypt. Specifically, based on Egyptian data, this study examines the value relevance of earnings, cash flows from operations and book values.

To examine the value relevance of the above accounting measures, this study uses statistical associations between accounting information and capital market values: the association between earnings and annual returns; the association between cash flows and accruals, and annual returns; and the association between earnings and book values of equity, and stock prices.

The results show that, first, earnings have value relevance. However, earnings changes are significantly more successful than earnings levels in explaining security returns. These results suggest that changes in earnings are largely permanent; hence, earnings follow (close to) a random walk model. Second, contrary to what is stated in the literature, cash flows from operations are not successful in explaining stock returns. This result suggests that cash flows are less important and not value relevant in Egypt compared to the USA or the UK. A possible explanation is that cash flows in Egypt are very volatile (high variance) and not persistent, so the market does not rely on them. Third, individually, both earnings and book values significantly explain stock prices; however, jointly, earnings have incremental explanatory power beyond book values for stock prices whereas book values do not. These results suggest that in Egypt the income statement is much more important than the balance sheet for valuation purposes. Overall, these results are interesting because they do not completely replicate the results from other countries.

The existence of value relevance for earnings despite the apparent lack of value relevance for cash flows can be interpreted as indicating that accruals are designed to offset and smooth cash flows’ volatility and low value relevance, so that earnings are relatively more persistent and relevant. These results show that earnings potentially are a much more important and informative measure of a firm’s value than cash flows from operations in Egypt. However, we certainly need the cash flows information as an ex-post validation of the prior earnings. Overall, it appears that the investors in Egypt are looking at the accounting data when evaluating the value of the firm, which is a good sign. However, the empirical findings of this paper are discussed.

This study contributes to the limited research on value relevance of accounting information in the emerging market of Egypt.

As an increasing number of business organizations around the world are engaged in the value relevance of accounting information, this study aims to assess the field of the accounting value relevance of book value and earnings in share prices of banks and financial institutions listed in the Tunisian stock exchange.

Using a sample of available banks and financial institutions listed in the Tunisian Stock Exchange from 2010 to 2015, this paper accommodates the documented accounting information in an emergent market context by using stock price of three months after year-end as a dependent variable. This study uses the panel regression technique on 24 banks and financial institutions during the study period.

The authors find that earnings and book value are statistically significantly associated with firm value. Also, using these variables together is positively related to the firm stock price share. Comparatively, these obtain evidence that book value is statistically more value-relevant than earning per share models; expectedly, the earnings explain a higher proportion of the stock price for the group of financial institutions than the group of banks.

A Web-based search is performed during the second quarter of 2016, locating the corporate websites of the sample firms, and the official site of the Datastream (worldscope) is identified. The sample period is 2010-2015 (144 firm-year observations).

This study examines the value relevance of recognised and disclosed revaluations of land and buildings for a large sample of Australian firms from 1993 through 1997. In contrast to prior research, we control for risk and cyclical effects and find no difference between recognised and disclosed revaluations, using yearly‐cross‐sectional and pooled regressions and using both market and non‐market dependent variables. We also find only weak evidence that revaluations of recognised and disclosed land and buildings are value relevant.

The study of developed capital markets suggests that information provided in financial statements has lost its value relevance to equity holders. The purpose of this paper is to explore this issue in the emerging market of Qatar.

Following other studies in the literature, the study examines the value relevance of earnings and book values using the price valuation model provided by Ohlson (1995). A total of 215 observations were collected from all firms listed on the Qatari Stock Exchange over a period of five years (2012–2016).

This study suggests that the value relevance of both earnings and book values has noticeably decreased over the sample period. However, its results show that the decline in the value relevance of earnings favored book values.

Like other studies, this one has limitations that suggest areas for future research. For example, in Qatar, like other emerging markets, a lack of data prevents the performance of deep analysis. Additionally, the authors only use Ohlson’s (1995) model as a framework for evaluation. It would be interesting to explore the changes when examining alternative valuation models. Another limitation is that the authors examine only two accounting measures: earnings and book values. Further research could explore changes in the value relevance of other measures, such as cash flow.

These findings provide empirical evidence regarding the value relevance of earnings and book values in an emerging market.

To the authors’ knowledge, this paper provides the first empirical evidence regarding the value relevance of earnings and book values in the emerging capital market of Qatar.

This paper aims to examine the value relevance of accounting information from an emerging country perspective.

The study adopts Ohlson (1995) Price model to examine the extent to which accounting information explain variation in stock prices of listed firms on the Ghana Stock Exchange.

The study reveals that earnings and book value of equity exhibit a positive and significant relationship in stock prices. Earnings explain higher variation in stock market values on the Ghana Stock Exchange compared to book value of equity. The study however finds that despite the introduction of the International Financial Reporting Standards in Ghana, the value relevance of book value and earnings have declined significantly over the period 2005-2014.

A key implication is that regulators of capital markets, standards setters and accounting practitioners need to consistently improve upon the quality of financial reporting disclosures which will boost the confidence of users in their reliance on financial statements as the basis for choosing among alternative use of scarce resources. The authors adopted only the price model in testing the hypotheses. However, to provide comprehensive understanding of value relevance of accounting information, future studies can combine both the price and the return models.

The authors extend prior literature in the Ghanaian context with recent data. Finally, the study adds to the efficient market hypothesis by showing how share prices reflect accounting information produced by Ghanaian firms.

Our chapter raises serious questions about the long-term efficiency of stock prices in relation to the realized returns of the underlying corporate real assets. In our large-scale calculations that cover horizons of 10, 20, 30, 40, and 50 years, returns on corporate real assets suffer a long-term decline, and have been below the yields of 10-year Treasury bonds since 1973. Real assets that received more external financing from capital markets and institutions actually report even lower realized long-term returns. The decline in realized returns cannot be attributed to declining risks as the volatilities of realized returns have been increasing over time. These surprising results may stimulate fresh debate on the roles and long-term performance of capital markets and institutions.

The purpose of this paper is to examine the association between audit quality and value relevance of representative accounting measures, such as earnings and book value of equity.

The authors estimate the standard value relevance equations and the modified equations by ordinary least square regressions and use two ways to compare the difference in the value relevance of earnings and book value of equity audited by Big 4 auditors and non‐Big 4 auditors, as characterized by the coefficient of determination, R2; and based on previous lines of published research.

Some evidence was found that, in the Taiwan capital market, in general, the earnings and book value of equity audited by Big 4 auditors explain more variations in stock return than those audited by non‐Big 4 auditors. The results are robust to different empirical models and measurements of value relevance and control for risk and growth factors. Consequently, both earnings and book value audited by Big 4 audit firms are generally more relevant than those audited by non‐Big 4 audit firms.

Assuming that the Big 4 audit firms provide a higher level of assurance and credibility, the overall results are generally consistent with the authors' prediction that audit quality, as captured by size of audit firms, improves the value relevance of earnings and book value of equity.

As one of the main purposes of financial statements is to provide relevant information for investors, relationships between share prices and accounting variables have been widely researched. Early studies focus mainly on earnings, but attention has turned in recent years to valuation models that include the book value of the equity. Many of these studies cite the residual income model as their theoretical base and, with the growing emphasis on shareholder value, residual income measures are more commonly used in the business community to track financial performance. Given such trends, the purpose of this paper is to review the theoretical background of the residual income model and discuss results of empirical studies that use it.

The study seeks an understanding of how published accounting information relates to share prices in the developed market in Asia, outside Japan. More specifically, the study aims to extend the international literature in market based accounting research by examining empirical evidence on relationships between share prices and the two summary accounting variables of equity book value and earnings for firms listed on the stock exchange in Malaysia.

The findings imply that, the two accounting variables summarising the balance sheet and the income statement, respectively, are significant factors in the valuation process, and that managers are justified in using the accounting system as a primary source of information for monitoring financial performance.

These findings should be of interest to other researchers, and to managers and investors who currently use or are planning to use residual income to monitor business performance.