ارتباط مقدار سود، ارزش دفتری و سود سهام در بازار سرمایه نوظهور : شواهد کویت

This study examines the value relevance of book value, earnings and dividends for a sample of all non-financial firms listed on the Kuwait Stock Exchange (KSE) over the period 2003–2009. After controlling for the impact of the global financial crisis, empirical results provide evidence on the value relevance of book value and earnings in the KSE. The results indicate that dividends are not a value-relevant in the presence of earnings in the valuation model. However, when dividends are used as a substitute for earnings they become value-relevant. The explanatory power of the model including both book value and earnings is almost indistinguishable from that of book value and dividends. Furthermore, splitting earnings into dividends declared (or paid) and earnings retained results in each of the two variables becoming value-relevant. The average dividend pay-out ratio tends to increase over time, indicating that dividend policies do matter in the KSE and that dividends in Kuwait are used to boost investors' confidence and support share price, noticeably during the global financial crisis period.

Financial statements are considered the most important source of information for stakeholders. Investors use financial statements to evaluate the share price of a firm by using valuation models. The general purpose of valuation models is to assess the impact of accounting information on stock prices. The ability of accounting data to summarize information affecting equity value is usually measured by the explanatory power of regression analysis as measured by R2. Valuation models with higher R2s indicate the ability of accounting data to explain the variations in stock prices. The value relevance of accounting information using cross-sectional valuation models has a substantial history in accounting and other literatures. Market-based accounting research (MBAR) often chooses between price models and return models. In price models, stock prices are regressed against earnings per share, whereas in return models, returns are regressed on scaled earnings variables (Kothari & Zimmerman, 1995). Prior value-relevance research is primarily based on the price model suggested by Ohlson (1995) and its subsequent refinements (e.g., Feltham & Ohlson, 1995). This study assesses the value relevance of accounting information in explaining the variation in stock prices for firms listed on the KSE as an example of an emerging Gulf cooperation council (GCC) market. Using a sample of 667 firm-year observations, the study employs Ohlson's (1995) valuation equation to investigate the value-relevance of earnings, book value and dividends in Kuwait. After controlling for the impact of the global financial crisis, empirical results provide evidence on the value relevance of book value and earnings of Kuwaiti listed firms. Dividends are found to be insignificant in the presence of earnings in the valuation model. However, when dividends are substituted for earnings, the estimated coefficient of dividends becomes positive and significant. The explanatory power of the model including both book value and earnings is almost indistinguishable from that including book value and dividends. Furthermore, splitting earnings into dividends declared (or paid) and earnings retained results in each of the two variables becoming value-relevant. Results from estimating the annual cross-sections provide evidence consistent with prior research that the value relevance of accounting information (measured by R2 values) in Kuwait has declined over time (e.g., Balachandran and Mohanram, 2011, Core et al., 2003, Dontoh et al., 2004, Elliott and Jacobsen, 1991, Entwistle and Phillips, 2003, Francis and Schipper, 1999, Lev and Zarowin, 1999 and Ramesh and Thiagarajan, 1995). The results also indicate that the average dividend pay-out ratio tends to increase over the study period, indicating that dividend policies do matter in Kuwait and that dividends are used to boost investors' confidence and support share prices, noticeably during the global financial crisis period. Furthermore, the value relevance of accounting information is not driven by industry effects in the KSE. However, the information content of accounting information is significantly higher for large Kuwaiti firms compared to their small firm counterparts. This study contributes to the existing literature via examining the value relevance of accounting information and particularly dividends for firms listed on the KSE as an example of an emerging GCC market. Prior studies provide evidence on the value relevance of book value and earnings for Kuwaiti listed firms (e.g., Alfaraih and Alanezi, 2011 and ElShamy and Al-Qenae, 2005), whereas the role of dividends in determining stock prices remains an empirical issue. In addition to examining the value relevance of earnings and book values, this study is the first to examine the value relevance of dividends utilizing Kuwaiti data. Furthermore, Al-Deehani and Al-Loughani (2004), in a research survey, indicate that managers in Kuwait are mainly motivated to pay dividends by two sets of value relevant motives. These are the “clientele-effect set” and the “signaling set”. They argue that dividend policies affect share value and are not determined residually, as suggested by Miller and Modigllani (1961). The findings of this study provide further empirical evidence on the value relevance of dividends and earnings for firms listed on the KSE. KSE was established in 1977. It was, however, reorganized in August 1983 as an independent financial institution managed by the Exchange Committee and the executive administration. KSE is one of the first and largest stock exchanges in the Middle East. Listed companies on the KSE are divided into seven sectors; banking, insurance, investment, real estate, industry, services and food. In September 2000, the Foreign Investment Law was issued by the Government to allow foreigners for the first time to invest in the KSE. The total market capitalization of the KSE increased consistently from US$ 59.5 billion in 2003 to US$ 122.3 billion in mid-2009, placing it as the second largest GCC stock market after Saudi Arabia. International Financial Reporting Standards (IFRS) are mandatory in Kuwait and the government controls the accounting and auditing professions. Hence, it can be argued that countries applying IFRS may allow varying degrees of deviation from clean surplus relationship than that observed by prior studies applying the US or other local Generally Accepted Accounting Principles (GAAPs). Therefore, it is possible that the information content of accounting information in Kuwait may vary. Moreover, equity ownership in Kuwait is often concentrated among small groups of major shareholders: the government and its agencies, dominant families, and institutional investors. These groups may influence the level and quality of disclosure, and may assert their power over the board to affect firm dividend policies, and hence the value relevance of accounting numbers. For example, Al-Kuwari (2009) provides evidence that government ownership has a significant effect in promoting dividend pay-outs for firms listed on the stock exchanges of GCC countries. Her results also reveal that these firms alter their dividend policy frequently and do not adopt a long-run target. Given these attributes, combined with an overall weak regulatory environment in Kuwait, it is possible that the information content of accounting variables and dividends in particular, may differ. The remainder of this paper is organized as follows. Section 2 reviews relevant prior research. Section 3, explains the research methodology employed in this study. Section 4 reviews descriptive statistics and empirical results. Section 5 provides additional analyses and Section 6 concludes.

The main objective of this study is to investigate the value relevance of earnings, book value and dividends utilizing Kuwaiti data as an example of an emerging GCC market. The study uses a sample of 667 non-financial firm-year observations listed on the KSE over the period 2003 to 2009. Kuwait is the third largest GCC capital market in which International Financial Reporting Standards (IFRSs) are mandatory and the government controls the accounting and auditing professions. Prior studies have primarily examined the value relevance of earnings and book value for the KSE-listed firms, whereas the role of dividends in determining stock price remains a contentious and empirical issue in the literature. Kuwait has a unique institutional setting in which firm ownership is concentrated among small groups of major shareholders who may directly or indirectly influence the level and quality of disclosure and may assert their power over the board to affect firm dividend policies. Given these poor disclosure and transparency practices, combined with an overall weak regulatory environment in Kuwait, it is possible that the information content of accounting variables, and particularly dividends, may differ. After controlling for the effect of the global financial crisis, empirical results provide evidence on the value relevance of book value and earnings in valuation models in the KSE. The estimated coefficients on book value and earnings are all consistently positive and significant. Dividends are not value relevant in the presence of earnings in the valuation model. However, when dividends are substituted for earnings in the regression equation, they become value relevant. The results also indicate that the explanatory power of the model including both book value and earnings is almost indistinguishable from that of book value and dividends. It is argued that dividends seem to be capturing some of the effects of earnings and book value on market share price, or to be acting as a proxy for the permanent component of earnings, thereby reducing the value relevance of earnings and/or book value. The study reemphasizes the view of Skinner and Soltes (2008) of distributed earnings as being relatively permanent and undistributed earnings as being relatively transitory. Thus splitting earnings into dividends declared (or paid) and earnings retained results in each of the two variables becoming value relevant. Results from estimating the annual cross-sections from 2003 to 2009, provide evidence that the value relevance of accounting information (measured by R2values) in Kuwait has declined over time. This result is consistent with the assertion in the literature that financial statements have lost their value relevance. Furthermore, the average dividend pay-out ratio tends to increase over time, indicating that dividend policies do matter in the KSE and that dividends in Kuwait are used to boost investors' confidence and support share price, noticeably during the global financial crisis period. The results of this study provide evidence on the valuation role of dividends in the KSE and empirically support the arguments of Al-Deehani and Al-Loughani (2004) that managers in Kuwait are motivated to pay dividends by the “clientele-effect set” or “signaling set” motives. Finally, the results reveal that the value relevance of accounting information is not driven by industry effects in the KSE. However, the information content of accounting information is significantly higher for large firms than for small firms.