THE VALUE RELEVANCE OF OTHER COMPREHENSIVE INCOME AND ITS COMPONENTS

Yousef Jahmani, Hae Yeon Choi, Yonpae Park and Gavin Jiayun Wu

Accounting & Taxation, 2017, vol. 9, issue 1, 1-11

Abstract: The value relevance of comprehensive income, other comprehensive income, and its components were investigated in this paper. Using data of S&P 500 for 2014 and utilizing the pricing model developed by Ohlson, the results suggest that both comprehensive income and other comprehensive income have no value relevance as measured by the coefficient of determination (R2). However, the components of other comprehensive income, such as derivatives, hedging and gains and losses from available for sale securities do have value relevance. The results of this research support the Financial Accounting Standard Board position on disclosure of other comprehensive income and its components

Keywords: Value Relevance; Comprehensive Income; Other Comprehensive Income; Firm Value; Book Value (search for similar items in EconPapers)
JEL-codes: G10 M41 (search for similar items in EconPapers)
Date: 2017
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