The Value Relevance of Components of Other Comprehensive Income When Net Income Is Disaggregated

Taisier A. Zoubi (), Feras Salama (), Mahmud Hossain and Yass A. Alkafaji ()
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Taisier A. Zoubi: Department of Accounting, School of Business Administration, American University of Sharjah, Sharjah, UAE
Feras Salama: Department of Accounting, School of Business Administration, American University of Sharjah, Sharjah, UAE
Mahmud Hossain: Department of Accounting, School of Business Administration, American University of Sharjah, Sharjah, UAE
Yass A. Alkafaji: Department of Accounting, School of Business Administration, American University of Sharjah, Sharjah, UAE

Review of Pacific Basin Financial Markets and Policies (RPBFMP), 2016, vol. 19, issue 04, 1-36

Abstract: The purpose of this study is to examine the equity pricing of other comprehensive income when earnings are disaggregated into several components. Our findings indicate that other comprehensive income can better explain variation in stock returns when net income is reported in a disaggregated form. Additionally, we find that disaggregating both net income and other comprehensive income can explain more of the variation in the stock returns than the two summary components of comprehensive income. Our results survive a series of robustness checks.

Keywords: Net income; other comprehensive income; value relevance; SFAS 130 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (3)

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DOI: 10.1142/S0219091516500272

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