A Study on the Value-relevance of R&D Expenditures and Advertising Expenditures：Evidence from Taiwan

• Main Authors: Ching-ying Lin, 林敬穎
• Other Authors: Wann-Cherng Wang
• Format: Others
• Language: zh-TW
• Published: 2009
• Online Access: http://ndltd.ncl.edu.tw/handle/94089905567416782814

碩士 === 國立成功大學 === 會計學系碩博士班 === 97 === Based on the Ohlson equity valuation model(1995), this study examines the value-relevance of R&D expenditures and advertising expenditures using Taiwanese firms listed on the TEJ database which span from 1987 to 2007. Under the latest Taiwan accounting standards, R&D expenditures and advertising expenditures must be expensed. However, R&D expenditures could be capitalized if it can provide future economic benefits. The results of this study indicate that R&D expenditures are positively associated with stock price. Moreover, the association is stronger for the capitalized R&D expenditures, suggesting that the R&D expenditures represent future economic benefits and should be capitalized. On the other hand, both advertising expenditures and other expenses are negatively associated with stock price, suggesting that investors believe that the economic benefits of advertising expenditures and other expenses expire in the current period. This study also examines the sensitivity of different definition for the independent variable and the effect of additional variable. The results are robust with respect to such choices.