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The purpose of this paper is to investigate how different research and development (R&D) accounting choice (capitalization and expensing) affects the value of the listed companies under the new Chinese Accounting Standards (CAS) background. According to new CAS, R&D expenditure can either be expensed as incurred as a whole or partly capitalized and partly expensed from 2007.

The paper takes the form of an empirical study using a hand-collected sample of 3,664 observations from Chinese listed companies over 2007–2012 timeframe.

It is found that different methods of reporting R&D investments do affect the value of listed firms in China. Specifically, the firms that chose to capitalize their R&D investments have higher stock price and return. On the contrary, the companies that select to expense their R&D expenditures have lower stock price and return. It is also found that capitalized R&D investments are positively connected to stock price, while expensed R&D expenditures are negatively related to stock prices.

This paper researches and finds the value relevance of R&D capitalization and expensing from the accounting report method itself. This explores some interesting research questions. Does choice of accounting method for R&D expenditure affect firm valuation? Do different methods of reporting R&D investments transfer different signal to investors? Does expensed R&D carry a negative signal to investors? So it can expand the existing R&D area of research.

This paper can provide empirical evidence and decision support for corporate managers, R&D policy makers and investors in a non-mandatory disclosure market of R&D expenditure. Because different R&D accounting choice has different market reactions, managers can choose a favorable method of reporting R&D investments to raise their firm’s stock price. Policy makers should standardize accounting treatment of R&D expenditure, strengthen the disclosure of R&D information and develop a detailed, workable R&D capitalization accounting policies and procedures. Investors can make the right judgment and decision on business innovation capability and future development only by getting more R&D investment information.

Different from present studies focusing on the value relevance of R&D investment, this paper explores an interesting topic showing how different methods of reporting R&D investment in China affect the value of the firms.

This paper aims to provide insight into how environmental information is reflected in the market value of listed Italian companies. In particular, it investigates the value relevance of voluntary environmental information disclosed by companies and the influence of environmental policies assurance.

The method used is the accounting-based valuation model used by Cormier and Magnan (2007), analogue to the one developed by Ohlson (1995), which considers market value of equity as a function of book value, accounting earnings and environmental indicators as provided by Bloomberg. The analysis in this paper is based on the environmental disclosure score (i.e. proxy of a company’s transparency in reporting environmental information) and the assurance practice (i.e. whether or not the company’s environmental policies were subject to an independent assessment for the reporting period).

Results partially support initial conjectures, i.e. the environmental voluntary disclosure represents value-relevant information positively correlated with firms’ market value. Furthermore, when such information is subject to an independent assessment for the reporting period, an incremental benefit deriving from the assurance of such information cannot be found. This is similar to the findings of Cho et al. (2014), i.e. the market perceptions on assurance may need to be developed before the environmental report assurance market in Italy can develop.

Limitations are related to the small sample located in a single country, meaning that results may not be generalisable. The implications are that other methods may provide further value, but these may need to be based either on different data or larger samples (i.e. cross-country analysis).

The increasing importance of environmental issues for economic decision-making and the presence of ethical investors create incentives for environmental information disclosure, which is becoming increasingly significant for comprehensive firm valuation. However, for this information to serve its role, disclosure must be credible. Hence, there are many companies that resort to voluntary assurance of environmental policies, motivated by a need to demonstrate credibility with external stakeholders. Notwithstanding, the influence of verification practice over environmental disclosure on a low regulation country has not yet been completely explored. This paper aims to fill this gap.