Study On The Value Relevance Of Other Comprehensive Income

In 2014, China’s Ministry of Finance revised "accounting standards for Enterprises No. thirtieth--financial statements" requirement. The new standards will be used from July 1, 2014 in the implementation of the enterprise accounting standards for all enterprises within the scope of the implementation. The "other comprehensive income" as a part of comprehensive income, is an important manifestation of the comprehensive income concept, supplemented by information on net profit. It can help stakeholders more fully understand the source and structure of enterprise income.This paper mainly studies "the value relevance of other comprehensive income" in the "Enterprise Accounting Standards No. thirtieth--financial statements". In the research method, first I use the theory of knowledge of the value relevance of other comprehensive income and other comprehensive income for the qualitative analysis, summarized in economics, financial theory on, clarify the other comprehensive income report has put forward and theoretical background support, also contributes to the empirical analysis and the conclusion of the study of and the suggestions. Secondly, the use of empirical methods to analysis whether has the value relevance of other comprehensive income. Finally, based on theoretical analysis and empirical analysis, and then draw conclusions and policy recommendations.The idea of this research can be listed as follows:Firstly, through the introduction, explain the background, purpose and significance of this research, evaluate and review the domestic and foreign research literatures are reviewed, and point out the degree of research progress at present. On the basis of previous research, the essay leads to the purpose of writing this article, frame, research method and innovation. The second chapter, states an overview of the theory of the value relevance of other comprehensive income, including the theoretical basis of other comprehensive income, the development of international convergence and comparison of domestic and foreign standards to rule as well as the similarities and differences in China in 2014 the new accounting standards. Additionally, sets forth a theoretical basis of the value relevance of other comprehensive income, mainly from the perspective of economics and financial accounting. Overview of the theory of two aspects, clarify the concept of other comprehensive income and put forward the theoretical basis of development, so as to lay a solid theoretical basis for this study. The third chapter makes an empirical study of the actual situation, combined with domestic listing Corporation, according to the research objective, puts forward the research hypothesis, selects the appropriate sample data, establishes the value regression analysis model, and analyzes the value relevance of other comprehensive income. A shares of listing Corporation in Shenzhen market is an empirical research on the data source of data. The fourth chapter, according to the theoretical and empirical analysis of the conclusions of the study, the value relevance of other comprehensive income, and according to this study, puts forward relevant policy suggestions.Through the analysis of theory and empirical study, we can see the other comprehensive income is a part of the implementation of asset liability view and comprehensive income concept comprehensively, and it is proposed along with the development of economy and the progress of the financial accounting theory, with the economics and finance theory as background knowledge. From the revision of accounting changes and the situation of international accounting standards assimilation analysis, other comprehensive income is of practical significance. Through empirical analysis, after putting forward the hypothesis, collecting sample data, establishing a regression analysis model, we can see the net income and comprehensive income have obvious value correlation, and the value relevance of other comprehensive income and comprehensive income and net profit is not so obvious. Therefore, it can only be said to be in a certain extent, other comprehensive income has the value relevance. But the comprehensive income, comprehensive income divided into net income and other comprehensive income in the form of presentation, do not be able to show more obvious value relevance than that of net profit. Therefore, investors will use decision analysis in the profit statement of accounting information, including net income, comprehensive income, other comprehensive income. But for the information in the financial statements, more attention is paid to the net profit, and the company stock price volatility is greatly affected by the factors of net profit.