Intangibles and value relevance of accounting information : evidence from UK companies
Other Title(s)
الأصول غير الملموسة و ملاءمة المعلومات المحاسبية : دليل من المملكة المتحدة
Joint Authors
Kimushi, Bilal
Rawabhi, Abd al-Nasir
Source
Jordan Journal of Business Administration
Issue
Vol. 12, Issue 2 (30 Jun. 2016), pp.437-458, 22 p.
Publisher
University of Jordan Deanship of Academic Research (DAR)
Publication Date
2016-06-30
Country of Publication
Jordan
No. of Pages
22
Main Subjects
Financial and Accounting Sciences
Topics
Abstract EN
This paper investigates whether intangible items that recognised in financial statements are value relevant in UK context, and whether these items affect the value relevance of other accounting information.
Empirical data were collected from a sample of UK listed companies, which included 1440 firm-year observations over 2005 to 2013.
Our research design has based on Ohlson (1995), in order to develop three models using Multiple linear regression, also Correlation analysis and ANOVA were applied.
The results indicate that intangible items as a whole explain a part of market values variability.
While the results of each item alone show that only intangible assets are value relevant, they affect positivelythe market values of UK companies, unlike goodwill and, amortization and impairment charges of intangibles, which are not value relevant.
In addition, intangible items have incremental value relevance, they affect positively and significantly the value relevance of accounting information, through improving their explanatory power.
The results imply that UK accounting standard setter must facilitate capitalizing intangibles as assets, impose the recognition of intangible assets separately from goodwill, and encourage companies to report more information about intangibles.
The review of accounting practices for amortization and impairment charges of intangibles is a necessary, in order to enrich financial statements’ content and, increase their pertinence.
American Psychological Association (APA)
Kimushi, Bilal& Rawabhi, Abd al-Nasir. 2016. Intangibles and value relevance of accounting information : evidence from UK companies. Jordan Journal of Business Administration،Vol. 12, no. 2, pp.437-458.
https://search.emarefa.net/detail/BIM-802583
Modern Language Association (MLA)
Kimushi, Bilal& Rawabhi, Abd al-Nasir. Intangibles and value relevance of accounting information : evidence from UK companies. Jordan Journal of Business Administration Vol. 12, no. 2 (2016), pp.437-458.
https://search.emarefa.net/detail/BIM-802583
American Medical Association (AMA)
Kimushi, Bilal& Rawabhi, Abd al-Nasir. Intangibles and value relevance of accounting information : evidence from UK companies. Jordan Journal of Business Administration. 2016. Vol. 12, no. 2, pp.437-458.
https://search.emarefa.net/detail/BIM-802583
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references : p. 454-457
Record ID
BIM-802583