Impact of Non Accounting Information on The Value Relevance of Accounting Information: The Case of Jordan

DHIAA SHAMKI

Abstract


The paper presents empirical evidence about the impact of firm’s shareholders number as non accounting information on the value relevance of its earnings and book value of equity as accounting information for Jordanian industrial firms for the period from 1993 to 2002. Employing the return regression analysis and using shareholders number in two proxies namely local and foreign shareholders number, the findings of the study are fourfold. First, Individual earnings are value relevant while book value is irrelevant. Second, combining earnings with book value leads both of them to be irrelevant. Third, extending local shareholders number has significant impact on the value relevance of individual and combined earnings. Forth, extending foreign shareholders number has significant impact on the value relevance of individual book value and combined earnings. Since studies on the value relevance of these variables have neglected Jordan (and the Middle Eastern region), the study is the first especially in Jordan that tries to fill this gap by examiningthe impact of shareholders numbers on the value relevance of earnings and book valueto indicate firm value.


Keywords


Return regression; earnings and book value; value relevance; local and foreign shareholders number;and Jordan

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DOI: http://dx.doi.org/10.18533/ijbsr.v2i1.202

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International journal of business and social research (Print)
ISSN 2164-2540

International journal of business and social research (Online)
ISSN 2164-2559

[International Journal of Business and Social Research (IJBSR) previously published by MIR Center for Socio-Economic Research, MD, USA. From February 2018 this journal is published by the LAR Center Press, OR, USA]