Business Performance Measurement－the Relation Between Accounting Rate of Return and Tobin''s Q

• Main Authors: Huang, Kai-Ping, 黃凱苹
• Other Authors: Shen Da-Bai
• Format: Others
• Language: zh-TW
• Published: 1996
• Online Access: http://ndltd.ncl.edu.tw/handle/89095415090198166514

碩士 === 東吳大學 === 會計學系 === 85 === With the rapid developing of economy and trade, the importance of accounting information is incerasing from day to day. To measure the business performance and profitability among the entire economic activities becomes the empirical matter. For example: internal resourec allocation, managerial compensation schemes, anti-trust cases and so on. They''re also decided by business performance and profitability. Nevertheless, it is worthy of concerning the relation between accounting information and business performance. The product of the accrual basis accounting－Return on Investment is widespred used as a measure of business performance. The use of asset revaluation data to estimate Tobin''s Q and ROI limit our sample to those firms that were listed nonfinancial firms and obtained from TEJ－Financial Data File. We restrict our sample to firms with positive values of ROI. This paper empirically examines the relation of economic rate of return and accounting rate of return: Return on Investment. Tobin''s Qis used as a proxy for economic rate of return. Besides, this paper also examines the impact of value of intangible asset on Tobin''s Q and tests the industrial effect. The results indicate(1)Tobin''s Q based on revaluation and based on book value exist significant difference. ROI has also the same result.(2)The analysis of data reveals statistically significant correlation between ROI and Tobin''s Q. These results provide strongly supproting evidence that accounting data contain economically meaningful information. ROI is a good indicator of business performance.(3)In different industries, ROI is insignificant correlated with Tobin''s Q.(4)The impact of value of intangible asset on Tobin''s Q is significant.(5)In different industries, intangible asset is also significant correlated with Tobin''s Q.