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Title: Value relevance of accounting information
Other Titles: evidence from Sri Lanka
Authors: Musthafa, Sulaima Lebbe
Jahfer, Athambawa
Keywords: Accounting Information
Book Value Per Share
Earnings Per Share
Operating Cash Flow Per Share
Value Relevance
Issue Date: 6-Jul-2013
Publisher: South Eastern University of Sri Lanka
Citation: Proceedings of the Third International Symposium 2013, pp. 21-30
Abstract: This paper investigates the value relevance of accounting information in Sri Lanka. The study uses book value per share (BVPS), earrings per share (EPS) and operating cash flow per share (OCFPS) as the independent variables and market value per share (MVPS) as the dependent variable. Sample of the study includes 310 firm-year observations from 5 largest industry sectors. Ohlson’s (1995) price model and an alternative model with operating cash flow per share are employed. Study finds that BVPS, EPS and OCFPS all have a positive and statistically significant relationship with market value per share. This finding proves that the accounting information is value relevant in Sri Lanka. Comparison of Ohlson model with the alternative model developed in this study reveals that both models are value relevant to Sri Lankan data. However, the alternative model with operating cash flow per share is more informative than the original Ohlson’s (1995) price model in Sri Lanka.
ISSN: 9789556270426
Appears in Collections:3rd International Symposium - 2013

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