Document Type : Research Paper


1 Assistant Professor of Accounting, University of Isfahan, Isfahan, Iran.

2 M.A of Accounting, University of Isfahan, Isfahan, Iran.


The relevance and usefulness of accounting information can be measured by the simultaneous relationship between accounting information, returns or stock market prices. The Comparability of accounting information, as a qualitative feature of information, increases the value relevance of accounting information. Also opacity in financial reporting through the corporate financial system increases stock volatility and, as a result, increases investment risk and investor distrust. Accordingly, the purpose of this study is the effect of comparability of financial statements and opacity in financial reporting on the value relevance between earnings and book value per share. Accordingly, a sample of 137 companies was selected from the companies listed on the Tehran Stock Exchange during the years 2013 to 2019 and to test the hypotheses, a multivariate regression model using the panel data method was used. The results showed that earnings and book value per share have a value relevance and the comparability of financial statements increases the value relevance of earnings per share. But contrary to the literature, comparability reduces the value relevance of book value per share. On the other hand, the opacity of financial reporting reduces the value relevance of book value per share due to comparability of financial statements, but does not affect the value relevance of earnings per share due to comparability.


Main Subjects

  1. Andriantomo, A., & Yudianti, F. N. (2013). The Value Relevance of Accounting Information at Indonesia Stock Exchange. International Conference on Business, Economics, and Accounting 20 23 March, 1- 14.
  2. Ball, R. & Brown, P. (1986). An Empirical Evaluation of Accounting Income Numbers. Journal of Accounting Research. 6, 159-177.
  3. Barth, M. Cram, D. p. & Nelson, K. (2001). Accruals and the Prediction of Future Cash Flows. The Accounting Review, 76, 25-58.
  4. Bepari, Md. Kh. (2012). Value Relevance of Accounting Information during a Financial Crisis: an Empirical Analysis of Australian Companies. [Doctoral thesis]. Dhaka University, 1-275.
  5. ‌Boubaker, S. Mansail, H., & Rajiba, H. (2014). Large Controlling Shareholders and Stock Price Synchronicity. Journal of Banking & Finance, 40, 80-96.
  6. Burgstahler, D., & Dichev, I. (1997). Earnings, Adaptations and Equity Value. The Accounting Review, 178-215.
  7. Chen, B., Kurt, A., & Wang, I. G. (2020). Accounting Comparability and the Value Relevance of Earnings and Book Value. Journal of Corporate Accounting & Finance, 31(4), 82-98.
  8. Choi, J. H., Choi, S., Myers, L. A., & Ziebart, D. (2019). Financial Statement Comparability and the Informativeness of Stock Prices about Future Earnings. Contemporary Accounting Research, 36(1), 389-417.
  9. Collins, D. W., Maydew, E. L., & Weiss, I. S. (1997). Changes in the Value-Relevance of Earnings and Book Value Over the Past Forty Years, Journal of Accounting and Economics, 24(1), 39-67.
  10. De Franco, G., Kothari, S., & Verdi, R. (2011). The Benefits of Financial Statement Comparability. Journal of Accounting Research, 49(4), 895-931.
  11. Fang, V. W., Iselin, M., & Zhang, G. (2019). Financial Statement Comparability: Theory and Evidence (Working Paper).
  12. Financial Accounting Standards Board (FASB). (2010). Statement of Financial Accounting Concepts No. 8: Conceptual Framework for Financial Reporting.
  13. Francis, J., & Schipper, K. (1999). Have Financial Statements Lost their Relevance. Journal of Accounting Research, 37(2), 319-352.
  14. Hayn, C. (1995). The Information Content of Losses, Journal of Accounting and Economics, 20, 125–53.
  15. Hutton, A., Marcus, A., & Tehranian, H. (2009). Opaque financial reports, R2, and crash risk. Journal of Financial Economics, 94, 67-86.
  16. Jin, L., & Myers, S. (2006). R2 around the world: New theory and new tests. Journal of Financial Economics, 79, 257–
  17. Kim, Y., Li, H., Li, S. (2014). corporate social responsibility and stock price crash risk, Electronic copy available at:
  18. Kim, S., Kraft, P., & Ryan, S. G. (2013). Financial Statement Comparability and Credit Risk. Review of Accounting Studies, 18, 783-823.
  19. Mungly, Y., Babajee, R. B., Maraya, N. P., Seetah, K., & Ramdhany, N. G. (2016). A Study on Corporate Governance and Value Relevance of Accounting Information: Evidence from Listed Companies in Mauritius. Proceedings of the Fifth Asia-Pacific on Conference on Global Business, Economics, Finance and Social Sciences, 21-23, Paper iD: M629.
  20. Ohlson, J. A. (1995). Earnings, Book value and Dividends in Security Valuation. Contemporary Accounting Research, 11(2), 87-661.
  21. Peterson, K., Schmardebeck, R., & Wilks, T. (2015). The Earnings Quality and Information Processing Effects of Accounting consistency. The Accounting Review, 90, 2483-2514.
  22. Titilayo, O. (2011). Value Relevance of Accounting Information in the Nigerian Stock Market [Doctoral Thesis] School of Postgraduate Studies, Covenat University, Ota, Nigeria, 1-200.
  23. Thijssena, M. W. P., Iatridis, G. E. (2016). Conditional Conservatism And Value Relevance Of Financial Reporting: A Study In View of Converging Accounting Standards, Journal Of Multinational Financial Management, 37–38, 48-70.
  24. Wang, F., Zhang, ZH., & Xu, L. (2020). Corporate Social Responsibility and Financial Statement Comparability: Evidence from China. Corporate Social Responsibility and Environmental Management, 27(3), 1375-1394.
  25. Blue, G., & Hasanzadeh diva, S. (2019). Impact of Comparability of Financial Statements on the Level of Cash Holdings with an Emphasis on the Role of Financial Reporting Quality, Financing Constraints and Corporate Governance. Applied Research in Financial Reporting, 7(2), 275-306. [In Persian]
  26. Esmaeli, Gh., Oshani, M., & Bakhshi, M. (2019). Conditional Conservatism and Value Relevance of Financial Reporting. Journal of Empirical Research in Accounting, 9(2), 271-292. [In Persian]

27.  Hashemi Dehchi, M., Izadinia, N., & Hajiannejad, A. (2021). The effect of Financial Statement Comparability on Value Relevance of Earning and Book value with Emphasis on Financial Reporting Opacity and Internal Control Weakness. Journal of Accounting Advances, 13(1), 379-409. [In Persian]

  1. Izadinia, N., Amini, V., & Rabiee, H. (2013). Value Relevance of Accounting Information in the Companies Listed in Tehran Stock Exchange. Empirical Research in Accounting, 3(2), 101-123. [In Persian]
  2. Mehrabanpour, M., Faraji, O., & Sajadpour, R. (2020). The Mediating Role of Financial Reporting Quality on the Relationship between Financial Statement Comparability and Cash Holdings. Accounting and Auditing Review, 27(1), 132-153. [In Persian]
  3. Mehrvarz, F. & Marfou, M. (2016). The Relationship between Financial Statements Comparability with Stock Price in Formativeness about Future Earnings. Empirical Studies in Financial Accounting, 13(49), 83-110. [In Persian]
  4. Sheri, S., & Samavati, P. (2011). Investigating the Ambiguity of Financial Reporting and the Distribution of Stock Returns. Journal of accounting and social interests, 1(2), 17-34. [In Persian]
  5. Zafari, S., Foroughi, D., & Kiani, G. (2019). The Impact of Accounting Comparability and Consistency on Earning Quality: A Text-Mining Approach. Empirical Studies in Financial Accounting, 16(64), 1-30. [In Persian]