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The relative information content of operating and financing cash flow in the proposed cash flow statement
Author(s) -
Francis Rick N.
Publication year - 2010
Publication title -
accounting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.645
H-Index - 49
eISSN - 1467-629X
pISSN - 0810-5391
DOI - 10.1111/j.1467-629x.2010.00344.x
Subject(s) - cash flow , cash flow statement , operating cash flow , equity (law) , content (measure theory) , cash on cash return , business , measure (data warehouse) , finance , computer science , cash and cash equivalents , mathematics , data mining , political science , mathematical analysis , law
This study compares the relative information content of the new specifications of operating and financing cash flow as proposed jointly by the IASB and the FASB with the specifications in SFAS No. 95. A unique feature of the study is the use of the Siegel and Biddle (1994) test of relative information content. The results indicate that the proposed operating cash flow measure has less relative information content than the current measure, and the results for financing cash flow are consistent with equity investors finding no significant difference between the current and proposed measures.