The predictive power of comprehensive income in Polish companies listed on the Warsaw Stock Exchange Cover Image

The predictive power of comprehensive income in Polish companies listed on the Warsaw Stock Exchange
The predictive power of comprehensive income in Polish companies listed on the Warsaw Stock Exchange

Author(s): Katarzyna Bareja, Magdalena Giedroyć, Małgorzata Wrzosek
Subject(s): Economy, National Economy, Supranational / Global Economy, Socio-Economic Research
Published by: Stowarzyszenie Księgowych w Polsce
Keywords: comprehensive income; predictive power; relevance

Summary/Abstract: Poland is historically classified within the Continental European model of accounting. The aim of the paper is to find the answer to the question of whether the Anglo-Saxon measure of financial results, which is comprehensive income, introduced into Polish reporting practice by the implementation of IFRS, has better predictive power than net income. The consequences of reporting comprehensive in-come are still a research gap in Poland. This article fills the gap regarding the predictive value of compre-hensive income on the Polish market, and at the same time, it constitutes a contribution to global research in this area. The content presented in this article was developed using studies of the domestic and foreign literature. The methodology adopted in our study refers to the commonly used methodology of quantita-tive research on value relevance and the predictive value of comprehensive income. Our results indicate that net income and comprehensive income have the same predictive value for future performance. The research showed that neither other comprehensive income as a single indicator nor separate items of other comprehensive income has significant predictive power for future performance. The results of our re-search may help legislative bodies to make decisions on whether to extend the financial statement by requiring the statement of comprehensive income. In addition, our study presents, in a very broad way, the results of the latest research on NI and CI.

  • Issue Year: 161/2019
  • Issue No: 105
  • Page Range: 113-136
  • Page Count: 24
  • Language: English