An Empirical Research On Relationships Between Accounting Information And Stock Pricing

The volatility of stock price can be influenced by a variety of factors. Among those factors, the accounting information disclosed by the listed companies is the most significant information source that can be directly and frequently used by investors. Therefore, it is necessary for investors to analyze and test the influences of accounting information on the stock price.The accounting information provided by the accounting system is the main source of the stock market information and the direct influencing factors of the stock price, and at the same time it is also the main basis and information sources of the investor's decision. Whether the accounting information is helpful for investors to make decisions in China? The thesis conducts an empirical study on the relationship between the accounting information and the stock price. Based on the model coined by Ohlson, the thesis introduces several accounting indexes which reflect the characteristics of listed companies, uses the method of combining the correlation analysis with multi-element regression analysis, and conducts an empirical study on the financial data of 198 listed companies which are listed in the stock market in Shanghai and Shenzhen for the period of 1998 through 2004 and establishes the regression model about the relationship between stock price and accounting information. Through the above analyses, the thesis tests the influences of accounting information on the stock price, and proves the function of accounting information in the stock market of China. The research results of the thesis provide the theoretical basis and decision-making instruments.The conclusions of the empirical research conducted by the thesis are as following:(1) The thesis testifies there is a significant relationship between accounting information and the stock price;the regression model established by the thesis holds perfect ability to explain the relationship between the stock price and accounting information.(2) The regression analysis for seven years of samples indicates that accounting information holds significant effects on the stock price;the multi-elemental regression modelshows that the accounting indexes hold strong united explaining ability in each year and the goodness of fit of the model is averagely above 50%.(3) The thesis induces the regression models for 1998 through 2004, and analyzes the regression coefficients of relative accounting indexes and provides the explanation on these coefficients based on the concrete conditions of each year.(4) Since 1998, listed companies started to disclose the Cash Flow Statement, and cash flow index has been concerned by the market.