| Summary: | 碩士 === 國立中央大學 === 會計研究所 === 106 === The purpose of this paper is to investigate the impact of corporate investment decision on earnings informativeness, and the moderating role of accounting conservatism on the relationships between corporate investment and earnings informativeness. We separately use R&D, capital expenditure, the sum of R&D and capital expenditure to measure corporate investment. We also use earnings response coefficient (ERC) and future earnings response coefficient (FERC) to measure earnings informativeness. As for accounting conservatism, we use a measurement named C_Score, which Khan and Watts (2009) developed on the basis of Basu (1997)’s model.
The empirical results indicate that corporate investment is significantly and positively related to earnings informativeness. Compared with R&D expenditure, investors have stronger positive response to capital investment decisions. After considering the moderating role of accounting conservatism, with higher accounting conservatism, corporates’ R&D expenditure is significantly and positively related to earnings response coefficient (ERC) ,while capital expenditure is significantly and positively related to future earnings response coefficient (FERC). Overall, corporate investment is significantly and positively related to earnings informativeness with higher accounting conservatism.
This paper provides some evidences on the effect of investment on earnings informativeness, and moderating role of accounting conservatism can increase the effect between investment and earnings informativeness. This study can be used as reference for future scholars and investors.
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