The Empirical Study Of The Information Content Of The Dividend Policy Under The Fair Value Measurement

As one of the core content of company financial, dividend policy has great influence on the future development of the company. In the existing research on dividend policy mainly focus on two aspects, which including the influence factors and the market reaction of corporate dividend policy. Based on the literature review on the classic dividend policy signal transmission research at our country and abroad, this paper analyses the market reaction of corporate dividend policy announcement under the influence of the fair value, which including the selection of the dividend policy types under the influence of the introduction of fair value, the dividend policy signal transmission whether still existing and the market reaction of the dividend policy announcement under the introduction of fair value. This paper proposed on the research hypothesis on the basis of theoretical analysis, and verified the theoretical assumptions through the empirical results using the data of 380 listed companies on the method of descriptive analysis, single factor analysis of variance and regression analysis.This paper consists of seven chapters. The first chapter mainly elaborates the research background, research purpose and significance of this article, the research of the overall framework and main innovative points. The fair value measurement has been introduced more than seven years. Most of the researches on fair value concentrate on accounting information value relevance, reliability, robustness, and the impact on the financial markets, however, only few researches mainly focus on the market reaction of cash dividend policy. There is no quantitative or qualitative research on the differences between the market reactions of three type’s dividend policy. However, the selection of the dividend policy in the listed company is not limited to the cash dividend policy. As a result, it is necessary that conducting a comprehensive analysis and comparison on the market reaction of different dividend policy under the introduction of fair value. In addition, the research on the information content of different dividend policy under the fair value measurement could provide a more reliable reference for the listed companies selecting the dividend policy and the investors choosing the investment direction.The second chapter reviewed the related literature at our country and abroad. The research on the effects on the dividend policy signal content of the fair value at our country and abroad is less, but the research about the theory and empirical of fair value and dividend policy signal respectively is more. Therefore, this article summarizes the literature from the related literature of the fair value, the related literature of the dividend policy signal transmission, and the related literature of the fair value impact on the dividend policy, and put forward the research direction of thesis based on the research of the before people.The third chapter analyses the impact on dividend policy information content of the fair value measurement from the perspective of the theory. In particular, this part analyses the impact on dividend policy information content since the new accounting standards introduced the fair value measurement on the basis of combing relevant theory of the fair value and the dividend policy. On the basis of the conclusion from the theoretical analysis, this paper put forward three research hypotheses:(1) the introduction of fair value has an impact on the selection of dividend policy of listed company;(2) the dividend policy still has the signaling effect after introducing the fair value measurement;(3) the market reaction caused by different dividend policy announcements is different under the fair value measurement.The fourth chapter is design of the research. Considering the fair value measurement mainly affects the value of financial and the derivative financial products, this article selects the listed company having higher trading financial assets shares both in the Shanghai and Shenzhen a-share market from 2006 to 2014 as the overall sample. After screening, this paper obtains 380 valid samples finally. This paper uses the method of event to analysis the share price volatility, and selects the cumulative abnormal return on the method of the market and risk adjustment model to measure the share price volatility. The statistical tool is the software SPSS19.0. The first step is descriptive statistics of the types of dividend policy and the cumulative abnormal return before and after the introduction of the fair value measurement; the second step is qualitative research of the effects on stock price fluctuations of the dividend policy using the method of single factor analysis of variance; the third step is quantitative research of the effects on stock price fluctuations of the dividend policy using the method of dummy variable regression model.The fifth chapter did the analysis by the means of empirical. The purpose of this paper is to do the comparison analysis about the information content of different dividend policy in the listed companies after the introduction of the fair value measurement. First of all, the descriptive statistics analysis of the dividend policy type of listed companies before and after the introduction of fair value concluded that the introduction of fair value have an impact on the choice of dividend policy of listed company; then, the descriptive statistics analysis of the cumulative abnormal return of listed companies before and after the introduction of fair value concluded that dividend policy still has the signaling effect after the introduction of the fair value measurement in the long-term and short-term; finally, Finally, using the single factor analysis of variance revealed influence about the existence of share price volatility from the dividend policy announcement before and after the introduction of fair value measurement and using the multiple comparison and incorporated the dummy variable into regression model to analyze the different information content of the different dividend policy type under the introduction of fair value measurement has shown that the selection of cash dividend policy has greater positive effect on share price volatility than the selection of stock dividend policy, the selection of stock dividend policy has less positive effect on share price volatility than the selection of mixed dividend policy, the signaling effect of the cash dividend policy and the mixed dividend policy is relatively consistent.The sixth chapter did the comparison analysis between the empirical results of the chapter five and the theoretical assumptions of the chapter three. In addition to the assumption that the market reaction caused by the cash dividend policy and the mixed dividend policy announcement under the fair value measurement is different didn’t get the validation, the rest of the assumptions are all verified. On the basis of the comparison conclusion, this paper put forward the following suggestions:(1) strengthening and improving the information disclosure system of the earnings quality of listed company;(2) the listed company making the dividend policy should combine its own current profitability with long-term profitability, having a long-term perspective;(3) the market investors should improve their professional quality, and grasp the policy and the market information related with share price movements all the time.The seventh chapter did the summary about the empirical conclusion, and pointed out the limitations in this paper and the prospect for the further research.