Value Relevance of Accounting Earnings and the Information Content of its Components: Empirical Evidence in Tunisian Stock Exchange

19 Pages Posted: 28 Oct 2006

See all articles by Mohamed Rafik BEN AYED

Mohamed Rafik BEN AYED

University of Tunis - Faculty of Economic Sciences and Management (ESSEC)

Ezzeddine Abaoub

Faculty of Economics and Management Sciences of Tunis

Date Written: October 2006

Abstract

The aim of this paper is to examine the value relevance of accounting earnings and its components for firm valuation in Tunisian Stock Exchange. We have tested three hypotheses relatives to the value relevance of alternative accounting measures and to the effect of the decomposition of this variable on its explanatory power. Empirical evidence showed on one hand, that operating income, income before taxes, special items and income taxes are value relevant for firm valuation and on the other hand, cash flow from operations and accruals are not value relevant.

Keywords: accounting earnings, value relevance, explanatory power, information content, Tunisian Stock Exchange

JEL Classification: G12, G14, M41, M47, N27

Suggested Citation

Ben Ayed, Mohamed Rafik and Abaoub, Ezzeddine, Value Relevance of Accounting Earnings and the Information Content of its Components: Empirical Evidence in Tunisian Stock Exchange (October 2006). Available at SSRN: https://ssrn.com/abstract=940791 or http://dx.doi.org/10.2139/ssrn.940791

Mohamed Rafik Ben Ayed (Contact Author)

University of Tunis - Faculty of Economic Sciences and Management (ESSEC) ( email )

B P 477
Le Bardo 2000
Le Bardo, TN Tunis 2000
Tunisia
0021671870277 (Phone)

Ezzeddine Abaoub

Faculty of Economics and Management Sciences of Tunis ( email )

Campus Universitaire
Le Bardo 2000
Tunis, TN El Manar 2000
Tunisia

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