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The Evolution in Value Relevance of Accounting Measures in Indonesia

Gadjah Mada International Journal of Business (GamaIJB) · Vol. 22 No. 1 (2020) · pp. 49–73

DOI
10.22146/gamaijb.54059
ISSN
2338-7238, 1411-1128
Published
2020-05-21
Publisher
Master in Management, Faculty of Economics and Business, Universitas Gadjah Mada
Language
eng
License
creativecommons.org/licenses/by-sa/4.0

Abstract

This paper utilizes the model of share price, which is derived from the valuation model of residual income, to rigorously assess the evolution of value relevance of accounting measures in Indonesia, an emerging market country which has its landscape of equity valuation changed substantially. Using two different approaches, cross sectional and panel regressions, the results indicates a strong linear association between share price and accounting measures. Cross-sectional yearly price regressions provide a strong evidence of non-linear changes on the value relevance of accounting measures over time. Moreover, using panel data analysis, the results of unconditional comparison tests reveal that that the increased value-relevance of the balance sheet would be offset by a reduction of the value-relevance of earnings per share during IFRS regime. It could potentially contribute to explain the decrease in value relevance of accounting numbers during the switchover to IFRS in Indonesia.

Keywords

Collaboration network of the authors

5 authors · 10 co-authorship links · 6 across different organisations

Hover or tap a name to highlight its co-authors. Double-click to open the author's page.

  • Universitas Gadjah Mada
  • Universitas Teknologi Yogyakarta
  • Different organisations
  • Same organisation
  • Affiliation unknown
  • Thicker line = more joint articles · bigger circle = more articles
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Co-authorOrganisationJoint articles
Jogiyanto HartonoUniversitas Gadjah Mada1
Junaidi JunaidiUniversitas Teknologi Yogyakarta1
Setiyono MiharjoUniversitas Gadjah Mada1
Bambang HartadiUniversitas Teknologi Yogyakarta1

Affiliations come from OpenAlex; journal OAI-PMH metadata carries none. Authors without an OpenAlex ID are matched by name, which can merge or split people.

Metadata source: OAI-PMH (metadata jurnal) https://journal.ugm.ac.id/gamaijb/oai, first harvested 28 Okt 2026, last seen 28 Okt 2026.
Original metadata (oai_dc) 
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	<dc:title xml:lang="en-US">The Evolution in Value Relevance of Accounting Measures in Indonesia</dc:title>
	<dc:creator>Suwardi, Eko</dc:creator>
	<dc:subject xml:lang="en-US">Accounting</dc:subject>
	<dc:subject xml:lang="en-US">Value relevance; Accounting measures; Share price model, IFRS</dc:subject>
	<dc:subject xml:lang="en-US"></dc:subject>
	<dc:description xml:lang="en-US">This paper utilizes the model of share price, which is derived from the valuation model of residual income, to rigorously assess the evolution of value relevance of accounting measures in Indonesia, an emerging market country which has its landscape of equity valuation changed substantially. Using two different approaches, cross sectional and panel regressions, the results indicates a strong linear association between share price and accounting measures. Cross-sectional yearly price regressions provide a strong evidence of non-linear changes on the value relevance of accounting measures over time.  Moreover, using panel data analysis, the results of unconditional comparison tests reveal that that the increased value-relevance of the balance sheet would be offset by a reduction of the value-relevance of earnings per share during IFRS regime. It could potentially contribute to explain the decrease in value relevance of accounting numbers during the switchover to IFRS in Indonesia.</dc:description>
	<dc:publisher xml:lang="en-US">Master in Management, Faculty of Economics and Business, Universitas Gadjah Mada</dc:publisher>
	<dc:contributor xml:lang="en-US">Universitas Gadjah Mada, Department of Accounting</dc:contributor>
	<dc:date>2020-05-21</dc:date>
	<dc:type>info:eu-repo/semantics/article</dc:type>
	<dc:type>info:eu-repo/semantics/publishedVersion</dc:type>
	<dc:type xml:lang="en-US">Peer-reviewed Article</dc:type>
	<dc:format>application/pdf</dc:format>
	<dc:identifier>https://journal.ugm.ac.id/gamaijb/article/view/54059</dc:identifier>
	<dc:identifier>10.22146/gamaijb.54059</dc:identifier>
	<dc:source xml:lang="en-US">Gadjah Mada International Journal of Business; Vol 22, No 1 (2020): January-April; 49-73</dc:source>
	<dc:source>2338-7238</dc:source>
	<dc:source>1411-1128</dc:source>
	<dc:language>eng</dc:language>
	<dc:relation>https://journal.ugm.ac.id/gamaijb/article/view/54059/27711</dc:relation>
	<dc:relation>https://journal.ugm.ac.id/gamaijb/article/downloadSuppFile/54059/11081</dc:relation>
	<dc:rights xml:lang="en-US">Copyright (c) 2020 Gadjah Mada International Journal of Business</dc:rights>
	<dc:rights xml:lang="en-US">http://creativecommons.org/licenses/by-sa/4.0</dc:rights>
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