An Empirical Study On The Value Relevance Of Intangible Assets

With the development of knowledge economy and fierce competition among enterprises, intangible assets have special characteristics and effects. They are sustainable development resources of enterprises and they represent the enterprise core competitive ability and the source of value creation. Therefore, intangible assets play more and more important roles in the process of enterprise development. People can clearly realize the importance of intangible assets information, but how to effectively operate and manage intangible assets? It has become an urgent task and important means of enterprises'future development. On February 15th,2006, Ministry of Finance has promulgated the new accounting standards system, including a basic criteria and 38 specific guidelines. "Accounting Standards for Enterprises No.6-intangible assets" has great changes. It will influence the recognition and measurement of intangible assets. Listed companies can enhance the value of intangible assets through the stock market, then increase the enterprise value.Foreign scholars have carried through a lot of theoretical research and positive research on the value relevance of intangible assets. They drew a conclusion:intangible assets can obviously improve the enterprise profitability and accounting earnings. Domestic scholars have got some achievement on the study of intangible assets. However, some limitations exist. As a whole, they have tested the intangible assets' influence on stock price and accounting earnings, yet there were little empirical research on the value relevance of intangible assets in different industries and categories.In fact, different industries and different kinds of intangible assets make the different contributions to enterprises'development.On the basis of the predecessors, this paper selects listed companies of Shanghai Stock Exchange from 2006 to 2008.Positive analysis is conducted to study on the value relevance of intangible assets.First, this paper tests the capital market reaction to the price of intangible assets; second, this paper tests contributions of intangible assets to company's operating performance; finally, this paper selects the sample data according to industries, collects category information of intangible assets and conducts more credible research on the value relevance of intangible assets. It is found that intangible assets have significant positive effect on stock price and company's operating performance. Different industries and different kinds of intangible assets make the different contributions to company's operating performance. Therefore, it is useful to analyze the value relevance of intangible assets according to different industries and different kinds of intangible assets.Based on the result, this paper supports the theory on the value relevance of intangible assets.It also proposes some suggestions:our country should constantly improve the revised accounting standards, enhance the recognition and measurement of intangible assets,provide the information of intangible assets;investors should pay more attention to the information of intangible assets, the securities regulatory departments have the responsibility to actively guide the investors;listed companies should improve the overall scale of intangible assets and optimize the internal structure of intangible assets, strengthen investment in research and development projects; every industry should carry out internal management according to their own characteristic. Intangible assets can create useful value for the company.