The Value Relevance Research Of Comprehensive Income Based On Chinese A-listed Company:Variation Tendency And Project Differences

With the development of capital markets,financial instruments and business activities became diversity,fair value accounting of properties appeared in the report as a measurement.The traditional income statement cannot meet the needs of users of financial statements for its incomplete.In such cases,the concept of comprehensive income has been come up,International Accounting Standards Board requires presentation of comprehensive income separately in the income statement since 1997,and it has experienced several times revision on specific presentation of the content and manner.As a result of convergence with IFRS,the Ministry of finance have been made a series of related provisions in 2006,2009 and 2014.What kind of impact on the usefulness of accounting information by these accounting changes? The revision on the guidelines in this regard is in line with the demand of development of China's capital market? In order to test the convergence effects,to further improve the system of accounting standards in our country,there is a need for in-depth studies on these issues.Based on the value relevance of accounting information,this thesis research the usefulness and changes of comprehensive income in three aspects related to financial statement presentation standards and the process of convergence with international practices:Firstly,static test the incremental or value relevance of comprehensive income;Secondly,longitudinal investigate whether the three years policies improved the value relevance of comprehensive income;The last one,research the difference of re-classified and non-classified of other comprehensive income in value relevance by the implementation of CAS30th(2014).Thesis choose 2007-2015 of China's A shares of listed companies as the sample data,use reward model by regression analysis,use price model in robustness test,use significant coefficient and Vuong test to judge the value relevance of comprehensive income.The study found that in the first two years of the implementation of CAS30th(2006),the value relevance of comprehensive income is lower than net profit,but after 2009 year,the result is opposite;Other comprehensive has incremental value relevance all the time;Both “Interpretation No.3” and CAS30th(2014)have failed to significantly improve the value relevance of comprehensive income,it means that they have not the same effect on share prices and stock returns,It has no rules to follow;The re-classified of other comprehensive has value relevance but no incremental value relevance;The non-classified of other comprehensive income does not have value relevance.Though,the value relevance of comprehensive income has no phase change,its effect on share prices and stock returns were significantly higher than net profit,which illustrate the convergence of accounting standards is meaningful.However,the change of other comprehensive income in 2014 does not reflect its actual value,because few companies can be presentation classification,and the non-classified does not has value relevance.Based on "useful decision" and cost savings considerations,it can be modeled on American accounting standards,only presentation which can be classified,or disclosed non-classified in the notes.