| Due to financial report target’s changing from concept of fiduciary duty to the decision-making useful concept, added with the introduction of fair value measurement attribute. "comprehensive income" began to enter people’s vision. Which finally leads to the issuing of " Interpretation of Accounting Standards for No.3" in our country in 2009. The standard explicitly requires companies to report "comprehensive income" and "other comprehensive income" in the income statement. As is known to all, the emergence of comprehensive income is mainly aim at measuring the gains and losses that has confirmed but unrealized, thus the model of "net income plus other comprehensive income" can not only include the original revenue information, but also disclose the unrealized gains and losses that bypass income statement and can only be directly included in the balance sheet before. As a result, the relationship between comprehensive income, which can reveal earning information more overall and enterprise value becomes scholars’ focus since the introduction of interpretation No.3.In addition to study the relationship between new revenue presentation item, namely total comprehensive income and enterprise value, the paper also discuss the present status between net income that is now under the impact of new report column and enterprise value, and also the incremental value relevance on enterprise value under the situation that net profit and other comprehensive income reported separately. As well as correlation between each individual among other overall income and enterprise value. The ultimate purpose of the research is hope that it can test the correlation of comprehensive income information and enterprise value through data support, and finally help information users to get a more rational and effective knowing of financial information of the target enterprises, and make their decisions more for their own. On the other hand, by a objective evaluation on comprehensive income’s actual effect in the domestic market, it can also help government agencies to make the related standards more specific and flexible.To do this, the paper firstly do a literature review of comprehensive income as well as the correlation studies between comprehensive income and enterprise value home and abroad. Then gives the definition and measurement indicators used in the paper of comprehensive income, and then introduce the concept of assets and liabilities, information theory of decision usefulness and measurement theory of decision usefulness. And finally proposes the big four assumptions on the basis of those theories.In order to ensure the timeliness and persistence of the research, the article chose Shanghai A-share market data from 2011 to 2014 as the research samples, and uses the model of price. The company’s share price is acted as explained variable, net assets per share, proportion of tradable shares, company size and the asset-liability ratio are control variable, and total net profit per share, comprehensive income per share, other comprehensive income per share as well as the specific compositions of other comprehensive income per share are explain variables. The paper build four different models for empirical test respectively, and in order to improve the credibility of the empirical results, the paper also do a robustness test through some selected data in shenzhen A shares market. The final results show that:(1)There is a positive correlation between net income per share and enterprise value;(2)There is a positive relationship between total comprehensive income per share and enterprise value;(3)Other comprehensive income can enhance the interpretation between net earnings per share and enterprise value;(4)There are different correlations between individuals among other comprehensive income per share and enterprise value, but only the relationship between sale financial assets in the profit or loss and stock price is relatively available, while the remaining fours do not have a obvious value relevance. |
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