Research On The Value-Relevance Of Deferred Taxes

Internationalization of accounting guidelines is a trend in the background of economy globalization. The new guidelines enacted in 2006 have been used for four years, which reflect balance concept more. As the biggest change in new guidelines system, CAS 18 even takes a new way by balance sheet liability method. So its implementation effect will influence the result of new guidelines system directly.The article will firstly analyze that, balance sheet liability method can meet the demand of investors'decision better theoretically, and the accounting information produced in the process have more value-relevance. At the same time, the article chose 1478 companies meeting the conditions for the sample data from Shanghai and Shenzhen Stock Market, and analyzed annual data of 2008 and 2009 by balance sheet model and price model. The result shows:(1) with new accounting guidelines, deferred tax assets and liabilities both increased the power of balance sheet and profit sheet; (2) due to deferred tax assets is defined as assets, which reflect the income profit of a company in the future, it has a significant positive relevance of enterprise value; due to deferred tax liabilities is defined as liabilities, which reflect the outflow of a company in the future, it has a significant negative relevance of enterprise value; (3) confirmed deferred tax assets of enterprises which have earnings management have an increased value-relevance, and deferred tax liabilities have an increased value-relevance too.At last, according to conclusions, proposes the following recommendations:completing accounting guidelines system, creating a fair and effective capital market environment, improving employees'level etc.