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The Value-Relevance of Financial and Nonfinancial Information—Evidence from Taiwan’s Information Electronics Industry

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  • Chiung-Ju Liang
  • Ming-Li Yao

Abstract

This study integrates general measurements of the information electronics industry based on the concepts of the balanced scorecard, intellectual capital, and intangible assets. The reasons for the difference between the corporate market value and book value are also analyzed, and the impacts of both financial and nonfinancial perspectives on the corporate value are explored. The component items of net income are found to be more effective in explaining the value of a company than merely looking at the bottom line. It is concluded that RI and EVA have significant and similar explanatory power in terms of evaluating the performance of the information electronics industry. Moreover, a review of the nonfinancial performance of information electronics companies on the basis of segmented samples reveals significant results in terms of explaining the value of the upstream, midstream, and downstream companies. Copyright Springer Science + Business Media, Inc. 2005

Suggested Citation

  • Chiung-Ju Liang & Ming-Li Yao, 2005. "The Value-Relevance of Financial and Nonfinancial Information—Evidence from Taiwan’s Information Electronics Industry," Review of Quantitative Finance and Accounting, Springer, vol. 24(2), pages 135-157, January.
    • Handle: RePEc:kap:rqfnac:v:24:y:2005:i:2:p:135-157
    DOI: 10.1007/s11156-005-6334-1
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    References listed on IDEAS

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    1. Amir, Eli & Lev, Baruch, 1996. "Value-relevance of nonfinancial information: The wireless communications industry," Journal of Accounting and Economics, Elsevier, vol. 22(1-3), pages 3-30, October.
    2. Trueman, B & Wong, MHF & Zhang, XJ, 2000. "The eyeballs have it: Searching for the value in internet stocks," Journal of Accounting Research, Wiley Blackwell, vol. 38, pages 137-162.
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    Cited by:

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    2. Arturo Leccadito & Stefania Veltri, 2015. "A regime switching Ohlson model," Quality & Quantity: International Journal of Methodology, Springer, vol. 49(5), pages 2015-2035, September.
    3. Adriana Cioca & Kassam Wehbe & Delia Popescu & Constanta Popescu, 2020. "The Main Drivers for Sustainable Decisions in a Family Business That Impact the Company’s Performance," Sustainability, MDPI, vol. 12(20), pages 1-14, October.
    4. Orens, Raf & Lybaert, Nadine, 2007. "Does the financial analysts' usage of non-financial information influence the analysts' forecast accuracy? Some evidence from the Belgian sell-side financial analyst," The International Journal of Accounting, Elsevier, vol. 42(3), pages 237-271.
    5. Joonho Moon & Won Seok Lee & Jimin Shim, 2022. "Chief Executive Officers and the Value of US Airlines: The Moderating Effect of Carrier Type," Sustainability, MDPI, vol. 14(13), pages 1-12, June.
    6. Rubio Martín, Gracia & Rodríguez Paredes, Mercedes & Maroto Acín, Juan Antonio, 2013. "La escasa relevancia de la información contable sobre los activos intangibles en la valoración de las empresas innovadoras españolas: el caso de los sectores farmacéutico y biotecnológico || The Low I," Revista de Métodos Cuantitativos para la Economía y la Empresa = Journal of Quantitative Methods for Economics and Business Administration, Universidad Pablo de Olavide, Department of Quantitative Methods for Economics and Business Administration, vol. 16(1), pages 68-94, December.
    7. Zéghal, Daniel & Maaloul, Anis, 2011. "The accounting treatment of intangibles – A critical review of the literature," Accounting forum, Elsevier, vol. 35(4), pages 262-274.

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