International Journal of Nonlinear Analysis and Applications

Book value versus the asset value after revaluation: Performance indicators of companies and the role of conservatism in them

Document Type : Research Paper

Authors

Department of Accounting, Rasht Branch, Islamic Azad University, Rasht, Iran

Abstract

The most important goal of revaluation is providing reliable fair price information close to economic realities for different decision-makers. Emphasising conservatism, this research comparatively studies the relationship between book values of assets concerning the performance indicators of companies. The statistical population of the research includes 146 companies listed on the Tehran Stock Exchange from 2009 to 2020. The research methodology is correlational and post-event causal, and the correlation and regression tests are used to test hypotheses. The results show a significant direct relationship between the book value of assets and the rates of return on assets and equity. In addition, conditional conservatism significantly negatively affects the relationship between the asset value after revaluation and the future cash flows. It also has a significant positive effect on the relationship between the book value of assets and the rate of return on assets.

Keywords

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International Journal of Nonlinear Analysis and Applications
Volume 15, Issue 11
November 2024
Pages 365-375
  • Receive Date: 22 August 2022
  • Accept Date: 14 October 2022