Ah And A-share Value Of Accounting Information Study

Accounting information plays an important role in the capital market and it provides the fundamental information from the investment perspective. In addition, financial index is the concentration of accounting information. Hence, we have to find which financial index is most useful to the investors? How dose these indexes affect them to make the decision? Researching on the value-relevance of accounting information is helpful to the investors and the listed companies for finding the valuation of stock at micro visual and understanding the efficient of the stock market at macro visual.As capital markets have developed internationally, in order to increasing their resources and investors, the major stock exchanges in the world cut down their listing cost makes companies easier in cross-listing. As one of the regional and global financial centers, Hong Kong has well-developed and internationalized capital market and makes it the first priority to those companies for foreign listing. In contrast with stock market in developed countries, Chinese stock market is emerging market and its system is still immature. The extent of information disclosure and the legal protections of shareholder interests are lower than western countries. Due to the existence of a dual reporting and dual auditing mechanism may improve the value-relevance of accounting information for cross-listing companies. In this article, we compare AH-share companies with A-share companies and believe that the former are much value-relevance than the latter.We use F-O model to analyse the relationship between two key indicators, earnings per share and book value per share, and stock price. If they are value-relevance, how do they affect the price. By reviewing the reform and construction of accounting standards in our country, we can find the international convergence of accounting standards is the central issue. We could find the changes in value-relevance among AH-share and A-share as time goes by. Second, as two independent variables in F-O model the earnings per share and book value per share simplify the accounting report information of income statement and balance sheet, it also lose some information during simplifying. According to the previous research, we add some adjustment to the basic F-O model.After empirical research, this article reached the following conclusions:(1)AH-shares are much value-relevance than A-shares.(2)A-shares'incremental explanatory power provided by cash flow are higher than AH-shares. We also find AH-shares'investor focus on book value per share.(3)In manufacturing, AH-shares are much value-relevance than A-shares. However, in transportation and warehousing is on the opposite.(4)The difference of AH-share between positive income and negative income is smaller than A-share.(5) A-shares'incremental explanatory power provided by scale are higher than AH-shares.(6)A-shares'investors pay more attention to the nature of the income.