Accounting Earnings, Change in Market Value and Cash Flows

2016 ◽  
Author(s):  
Peter D. Easton ◽  
Peter B. Vassallo ◽  
Eric H. Weisbrod
Keyword(s):  
Market Value ◽  
Cash Flows ◽  
Accounting Earnings ◽  
Earnings Change

MBAR Models: A Test of ARIMAX Modelling

2011 ◽  
Vol 14 (02) ◽  
pp. 347-366
Author(s):  
Anastasia Maggina
Keyword(s):  
Loss Function ◽  
Stock Exchange ◽  
Explanatory Power ◽  
Accounting Earnings ◽  
Explanatory Variables ◽  
Minimum Value ◽  
Standard Models ◽  
Athens Stock Exchange ◽  
Squared Residuals ◽  
Earnings Change

The main purpose of this paper is to provide evidence on some of the standard models of accounting earnings and returns relations mainly collected through the literature. Standard models such as earnings level and earnings changes, among others, have been investigated in this study. Models that correspond better to the data drawn from the Athens Stock Exchange have been selected. Models I, II, V, VII and IX have statistically significant coefficients of explanatory variables. In addition, model II with the MSE (minimum value of squared residuals) loss function in ARIMAX (2,0,2) is prevalent. Models that include prior earnings in various forms using levels, changes in price and changes in earnings, change in price to beginning price, lagged parameters and differentiated price models have statistically significant explanatory power.

scholarly journals A comparative study of information content of cash flow, cash value added, accounting earnings, and market value added to book value of total assets in evaluating the firm performance

2017 ◽  
Vol 5 (2) ◽  
pp. 112
Author(s):  
Mohammad Delkhosh ◽  
Zahra Malek ◽  
Maryam Rahimi ◽  
Zohreh Farokhi
Keyword(s):  
Firm Performance ◽  
Information Content ◽  
Financial Reporting ◽  
Value Added ◽  
Market Value ◽  
Cash Flows ◽  
Maximum Information ◽  
Book Value ◽  
Operating Cash Flows ◽  
Market Value Added

The aim of the present study was to compare the utility of traditional accounting reporting and financial reporting for performance evaluations. Accordingly, the relationship between six ratios of net cash flows, net operating cash flows, cash value added, income after tax, income before tax, and market value added to the book value of total assets and Tobin’s Q ratio as an indicator of performance evaluation were examined. For this purpose, the information of 122 companies listed on Tehran Stock Exchange in the years 2009 to 2014 were used. Besides, linear regression and analysis of variance (ANOVA) were used to analyze the data. The results showed that except for the ratio of net cash flows to the book value of total assets, there was a significant relationship between the other five ratios. In addition, it was noted that cash value added to net operating cash flows had more information content concerning evaluating the firm performance. The results also indicated that net cash flows did not contain information content for evaluating the firm performance. However, the market value added had the maximum information to be used for evaluating the firm performance.

Calculating the market value of riskless cash flows

1986 ◽  
Vol 15 (3) ◽  
pp. 323-339 ◽  
Author(s):  
Richard S. Ruback
Keyword(s):  
Market Value ◽  
Cash Flows

The Effects of Accruals Quality on Audit Hours and Audit Fees

2015 ◽  
Vol 32 (3) ◽  
pp. 372-400 ◽  
Author(s):  
Myojung Cho ◽  
Eunsun Ki ◽  
Soo Young Kwon
Keyword(s):  
Cash Flow ◽  
Negative Relationship ◽  
Audit Fees ◽  
Discretionary Accruals ◽  
Cash Flows ◽  
Accounting Earnings ◽  
Accruals Quality ◽  
Cash Flow Risk

We investigate whether auditors take into account accruals quality, a proxy for the cash flow risk associated with earnings, by adjusting audit hours and audit fees. Accruals quality tells investors about the mapping of accounting earnings into cash flows. Poor accruals quality weakens this mapping and thus increases this cash flow risk. We find a negative relationship between accruals quality and audit hours/fees, indicating that auditors increase their audit efforts by modifying audit procedures and substantive tests and charge higher fees for the increased cash flow risk. In addition, we find that both innate accruals quality and discretionary accruals quality are negatively related to audit hours and fees but that innate accruals quality is more likely to influence audit hours and fees than discretionary accruals quality. The results indicate that auditors incorporate the cash flow risk associated with accruals quality but that their response varies according to the source of accruals quality.

scholarly journals Valuation Schools and the Evolution of the Income Approach. An Evaluation of Change Trends

2019 ◽  
Vol 27 (2) ◽  
pp. 66-76
Author(s):  
Ewa Kucharska-Stasiak
Keyword(s):  
Cash Flow ◽  
Financial Reporting ◽  
Relevant Literature ◽  
Market Value ◽  
Cash Flows ◽  
Advantages And Disadvantages ◽  
Eu Legislation ◽  
Income Approach ◽  
The Subject ◽  
Valuation Methodology

Abstract The income approach is the subject of debates conducted by academics and practitioners as one of the most controversial approaches in valuation practice. It is also somewhat differently understood by the three historically shaped valuation schools (US, British and German). This article compares the main assumptions underpinning the income approach’s investment method between the three schools in order to: 1) determine why the assumptions change and in what direction; 2) assess the advantages and disadvantages of explicit cash flows; and 3) evaluate the advisability of incorporating explicit cash flows into Polish valuation methodology. A thesis is formulated that, in Poland, the investment method should use implicit cash flows for estimating the market value of properties. There is a need to include explicit cash flow in university programs, but their use should be limited to valuations undertaken to determine the investment value of a property or the market value of portfolio properties, as well as valuations carried out for the purposes of financial reporting as required by EU legislation (MSSF 13 and MSR 40). The article was prepared based on the review and analysis of the relevant literature.

scholarly journals KREATIVNO FINANSIJSKO IZVEŠTAVANJE O NOVČANIM TOKOVIMA

2017 ◽  
pp. 163
Author(s):  
Aleksandra Arsenijević ◽  
Tadija Đukić
Keyword(s):  
Cash Flow ◽  
Financial Reporting ◽  
Market Value ◽  
Financial Statements ◽  
Cash Flows ◽  
Financial Position ◽  
A Company ◽  
Operating Activities

Financial statements should realistically show financial position, performance, and cash flows of a company. Creative financial reporting represents a deliberate manipulation of information in financial statements in order to create misperceptions on company operations. Creative financial statements are primarily intended for investors, in order to encourage them to purchase company shares and thus increase its market value. Creativity in compiling cash flow statements lies in presentation of operating activities as investing and financing activities, and vice versa.

scholarly journals The Effect Of Accounting Regime Characteristics On The Prediction Of Future Cash Flows: An International Comparison

2011 ◽  
Vol 7 (5) ◽  
Author(s):  
Joan Hollister ◽  
Victoria Shoaf ◽  
Gregory Tully
Keyword(s):  
International Comparison ◽  
Common Law ◽  
Explanatory Power ◽  
Cash Flows ◽  
Short Term ◽  
Accounting Earnings ◽  
Earnings Components ◽  
Accounting Accruals ◽  
Near Term ◽  
Future Cash Flows

For nine countries, we show that the components of accrual accounting earnings provide information incremental to that of current cash flows from operations in explaining next years cash flows from operations. We relate the usefulness of accounting earnings components for explaining near-term cash flows to certain country characteristicscommon/code-law jurisdiction, accrual index, shareholders rights, and uncertainty avoidance. We provide evidence that accounting accruals generated by shorter horizon, code-law regimes provide more incremental explanatory power for short-term predictions than those of longer horizon, common-law countries.

scholarly journals EFFECT OF INFORMATION ON ACCOUNTING PROFITS AND CASH FLOW COMPONENTS ON STOCK PRICES OF INSURANCE COMPANIES LISTED IN INDONESIA STOCK EXCHANGE (BEI) 2008-2012 PERIOD

2019 ◽  
Vol 15 (2) ◽  
pp. 171
Author(s):  
Nico Lukito ◽  
Kristian Chandra
Keyword(s):  
Interest Rates ◽  
Cash Flow ◽  
Stock Prices ◽  
Stock Exchange ◽  
Financial Statements ◽  
Cash Flows ◽  
Insurance Companies ◽  
Research Model ◽  
Accounting Earnings ◽  
Independent Variables

<p><em>Many factors influence the fluctuation of stock prices, including: deposit interest rates, stock trading volume, return on equity, earnings per share. The last two factors are part of the financial statements presented by the issuers. The financial statements contain accounting earnings information and cash flow. Therefore it is necessary to examine empirically whether accounting earnings and cash flows have an influence on changes in stock prices. Data is collected from the stock prices of insurance companies that have gone public in the Jakarta Stock Exchange which have a nominal value per share of Rp.1,000.00 (one thousand rupiah) from 2008 to 2012. This study took 10 existing insurance companies to analyze. The basis for this sampling is based on the amount of data available on the Jakarta Stock Exchange Website. From the results of variable analysis of total cash flow and accounting profit variables in the first equation individually can not significantly influence stock prices. And together all the independent variables have no effect simultaneously on stock prices. The value of Squared R is very low, which means that the variable cannot explain stock prices, but can be explained by other variables not included in the research model. Variable operational cash flows, investment cash flows and funding cash flows in the second equation individually can not influence stock prices significantly. And together all the independent variables have no effect simultaneously on stock prices. Also obtained is a very low R Squared value, which means that the variable cannot explain stock prices, but can be explained by other variables not included in the research model</em></p>

Sign in / Sign up

Export Citation Format

Share Document