Factors Affecting the Value Relevance of Accounting Information

Mahmoud Dehghan Nayeri (), Ali Faal Ghayoumi () and Mohammad Ali Bidari ()
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Mahmoud Dehghan Nayeri: Islamic Azad University
Ali Faal Ghayoumi: University of Shiraz
Mohammad Ali Bidari: Azad Islamic University

International Journal of Academic Research in Accounting, Finance and Management Sciences, 2012, vol. 2, issue 2, 76-84

Abstract: The present study examines the factors affecting the value relevance of accounting information for investors in the Tehran Stock Exchange over the period of six years. In this study, the effect of four factors; being profitable or loss generating, company size, earnings stability and company growth on the value relevance of accounting information have been studied. For this purpose Ohlson model and the cumulative regression analysis is used in order to examine the hypotheses and as the basis of data analysis T-test by Regression coefficient analysis is deployed. Findings confirm that these factors influence on the value relevance of accounting information for investors in Tehran Stock Exchange. Based on this study it can be concluded that accounting information of companies with profitability, small companies, companies with stable high earnings and companies with high growth rate are more value relevant in the Tehran’s stock market. These results are more useful for Iranian investors in their investing decision makings.

Keywords: Value-relevance; accounting information; stock exchange; earnings stability (search for similar items in EconPapers)
JEL-codes: G10 M41 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (1)

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