Detail How comprehensive is comprehensive income? The value relevance of foreign currency translation adjustments Bibliografi Author: Pinto, Jo Ann Maria ; Sannella, Alexander J. (Advisor) Topik: BUSINESS ADMINISTRATION; ACCOUNTING Bahasa: (EN )    ISBN: 0-599-49811-0     Penerbit: RUTGERS THE STATE UNIVERSITY OF NEW JERSEY - NEWARK     Tahun Terbit: 1999     Jenis: Theses - Dissertation Fulltext: 9947579.pdf (0.0B; 6 download) Abstract This study examines the association between foreign currency translation adjustments, which are a component of comprehensive income, and equity valuation. Foreign currency translation adjustments provide a measure, albeit an imperfect one, of the exchange rate exposure faced by U.S. multinational firms. Prior empirical evidence has been unable to forge an unambiguous link between foreign currency translation adjustments and firm valuation. This study adds to the existing literature by empirically testing the value relevance of foreign currency translation adjustments when proxies for the theoretical sources of exchange rate exposure are included in an equity valuation model. The value relevance of foreign currency translation adjustments is examined in: (1) an earnings and book value valuation framework and (2) a year-over-year earnings change model. The value relevance of foreign currency translation adjustments is tested on a sample of 294 U.S. multinational firms for the time period 1991–1996. The sample is divided between firms with subsidiaries in Mexico and Germany. In order to account for the heterogeneity of exchange rate exposure, the sample firms come from a wide range of industrial groupings, sizes and levels of capital intensity. A panel data set and weighted-least-squares (WLS) are employed to obtain parameter estimates. This study provides empirical evidence which demonstrates that exchange rate exposure, as measured by foreign currency translation adjustments, varies substantially in the cross section. In addition, this study also documents that foreign currency translation adjustments can be used to predict year-over-year changes in earnings per share. The main finding of this study is that foreign currency translation adjustments are significantly value relevant accounting explanatory variables given that their parameter estimates are allowed to vary cross-sectionally according to: firm size, location of foreign direct investment, capital intensity and industrial classification. Opini Anda Klik untuk menuliskan opini Anda tentang koleksi ini! Lihat Sejarah Pengadaan  Konversi Metadata   Kembali

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