The Impact of Differences between Consolidated Financial Statement and Parent’s Financial statement on Earnings Persistence

• Main Authors: Te-yi Hsu, 許德儀
• Other Authors: Cha-chi Lu
• Format: Others
• Language: zh-TW
• Published: 2015
• Online Access: http://ndltd.ncl.edu.tw/handle/e43e2q

碩士 === 國立中央大學 === 會計研究所 === 103 === This study aims to explore the difference between consolidated financial statements and parent’s financial statements with the disclosure of firm value. It is to understand whether or not financial statement users can identify real operating condition of corporationthrough disclosed information in the financial statements of the parent company and consolidated statements. In this study, listed companies from Taiwan stock market and over-the-counter are selected as our research samples from 2005 to 2007. The panel data is tracked by operating profit and loan to explore the combined effects of differences in financial statement information on the firm value. Empirical results indicated that： (1.) The difference of operating profit between consolidated financial statements and parent’s financial statements is significantly positive correlated with earnings persistence. (2.) The difference of loans between consolidated financial statements and parent’s financial statements is significantly positive correlated with earnings persistence. (3.) Combined operating profit and loan effect, it indicates that related party transactions will enhance the persistence of earnings, to reduce the risk and cost generated from information asymmetry, and improve the efficiency and transparency of trading transaction.