Abstract: Financial results are the main source of information for investors on the stock market. The International Accounting Standards Board has been changing the basic rules regarding a shift from net income to comprehensive income as the main picture of the financial performance of a business. Up to now net income has been frequently researched for usefulness in financial analysis and its association with market returns and the stock price. The results of previous research are not consistent. Comprehensive income has been rarely analysed in this aspect. The article examines the relation between comprehensive income and stock price of the energy industry companies listed on the Warsaw Stock Exchange in the period 2010-2019. The author showed the theoretical and legal aspects of comprehensive income and analysed its influence on the stock price and market returns, using a quantitative approach.
<a href="https://dx.doi.org/10.15611/fins.2021.1.05">DOI: 10.15611/fins.2021.1.04</a>
<p>JEL Classification: M41</p>
<p>Keywords: comprehensive income, stock price, statement of comprehensive income, clean surplus.</p>
<h2>1. Introduction </h2>
<p>The main goal of financial reporting is to provide financial information about an entity, that is useful for existing
or potential investors, lenders and other creditors in making decisions (International Accounting Standards Board,
2020). Stock market investors, in their decision-making process, rely on financial information from the financial
statements (Arkan, 2016; Szyszka, 2002). Measuring company performance and the financial position of a business is a
major concern for a user of accounting information (Kanagaretnam, Mathieu, & Shehata, 2009). </p>
<p>There are many views as to the main goal of running a business. According to neoclassical economics, profit is the
main purpose. Economists say it is the prime mover or energizer of the capitalistic economy (McConnell, Brue, &
Flynn, 2009, <br />p. 284). The ways of measuring and presenting company results have an important impact on users’
decisions (Frendzel, & Szychta, 2014). In accounting there are two main concepts defining the measurement of
financial results (income) of a company in a specified period (Bek-Gaik, 2013, Newberry, 2003):</p>
<ul>
<li>as a measure of the performance of an enterprise and its management;</li>
<li>as a change of investor wealth.</li>
</ul>
<p>The first concept assumes that the economic results of a company are connected with the decisions of management and
economic processes associated with that. This is a measurement of a company related to the dirty surplus accounting
concept. Some “dirty surplus accounting flows” are shown directly in shareholders’ equity and kept out of earnings
(Wang, Buijink, & Eken, 2006). </p>
<p>The second concept, associated with clean surplus accounting, assumes that income should measure all changes in the
economic value of a business entity resulting from all activities and circumstances, except those arising from
investments by and distributions to owners. This result is measured as comprehensive income.</p>
<p>Comprehensive income is defined as the change in equity of a business enterprise during a period from transactions
and other events and circumstances from non-owner sources (FASB Concepts Statement No. 6…, 1985). It includes all
changes in equity during a period, except those resulting from investments by owners and distributions to owners. </p>
<p>As stated in International Accounting Standard 1 (IAS 1), total comprehensive income includes all elements of profit
and loss and those of other comprehensive income, it also comprises items of income and expenditure (including
reclassification adjustments) that are not recognized in profit or loss as required or permitted by IFRSs. According
to IAS 1, the components of other comprehensive income include:</p>
<ul>
<li>changes in revaluation surplus; </li>
<li>remeasurements of defined benefit plans;</li>
<li>gains and losses arising from translating the financial statements of a foreign operation;</li>
<li>gains and losses from investments in equity instruments designated at fair value through other comprehensive
income;</li>
<li>gains and losses on financial assets measured at fair value through other comprehensive income;</li>
<li>the effective portion of gains and losses on hedging instruments in a cash flow hedge, and the gains and losses on
hedging instruments that hedge investments in equity instruments measured at fair value through other comprehensive
income;</li>
<li>for particular liabilities designated as at fair value through profit or loss, the amount of the change in fair
value that is attributable to changes in the liability’s credit risk;</li>
<li>changes in the value of the time value of options when separating the intrinsic value and time value of an option
contract and designating as the hedging instrument only the changes in the intrinsic value;</li>
<li>changes in the value of the forward elements of forward contracts when separating the forward element and spot
element of a forward contract and designating as the hedging instrument only the changes in the spot element, and
changes in the value of the foreign currency basis spread of a financial instrument when excluding it from the
designation of that financial instrument as the hedging instrument;</li>
<li>insurance finance income and expenses from contracts issued within the scope of IFRS 17 Insurance Contracts
excluded from profit or loss when total insurance finance income or expenses is disaggregated to include in profit
or loss an amount determined by a systematic allocation, or by an amount that eliminates accounting mismatches with
the finance income or expenses arising on the underlying items;</li>
<li>finance income and expenses from reinsurance contracts held excluded from profit or loss when total reinsurance
finance income or expenses is disaggregated to include in profit or loss an amount determined by a systematic
allocation.</li>
</ul>
<p>Those categories extend net income by capital changes which are the difference between net income and comprehensive
income. </p>
<p>The International Accounting Standards Board (IASB) has been changing the basic rules regarding a shift from net
income to comprehensive income as the main picture of the financial performance of a business, which shows the
effectiveness of business activities. The implementation of the revised IAS 1 Presentation of Financial Statement in
2009 has obligated companies using the International Financial Reporting Standards to show comprehensive income.
Nevertheless, financial results, defined as net income, are still being used as an indicator of the earnings
(Rówińska, 2019). </p>
<p>According to the definition and international accounting standards, comprehensive income, and not net income, show
the full picture of the situation of the company. It includes all changes in equity and shows the entire view of the
financial performance and value of the company, as well as improves the ability to predict future earnings and cash
flows. Using comprehensive income should enable investors to estimate the value of the given firm (Kanagaretnam,
Mathieu and Shehata, 2009), which indicates the market value and stock price.</p>
<p>The association between earnings, market returns and stock price has been researched before, mostly considering net
income as a measurement of earnings. The comprehensive income concept was also included in the research, again with
comparison with net income. In this article, author assumed that comprehensive income is a measurement of financial
performance, which is an innovative concept in this kind of research in the Polish context.</p>
<p>The article aims to check if reported earnings – described as comprehensive income – are associated with the market
returns and the stock price, and whether it affects those categories.</p>
<h2>2. Literature review</h2>
<p>The influence of company results, especially earnings (measured as net income or comprehensive income) on stock price
and market returns, has been researched by many economists. Ball and Brown (1968) showed that there is a relation
between earnings and stock price. Lev (1989) stated that earnings appear to be used by investors, but on the other
hand, the extent of their usefulness is limited, and the correlation between stock price and stock return is weak. Har
and Ghafar (2015) researched the impact of earnings (financial indicators) on stock return, and found them useful in
predicting stock returns. Lipe (1990) showed that changes in prices are correlated with future earnings. Isidro and
Dias (2017) pointed out that the correlation between stock price and reported earnings varies in different firms. </p>
<p>In their research, various authors also indicated earnings as comprehensive income or compared net income and
comprehensive income. Dhaliwal, Subramanyam and Trezevant (1999) could not find evidence that comprehensive income has
more association than net income, nevertheless they found evidence that comprehensive income is associated with stock
returns. Similar results were obtained by Goncharov and Hodgson (2011) who, based on their research on European
capital markets, found that comprehensive income and other comprehensive income elements are connected with price, but
not as much as traditional net income. Chambers, Linsmeier, Shakespeare and Sougiannis (2007) found from their sample
based on S&P 500 companies that elements of other comprehensive income affect pricing and returns.</p>
<p>Kanagaretnam, Mathieu and Shehata (2009) showed that comprehensive income explains stock price better than net
income, as some elements of comprehensive income (unrealized gains and losses on AFS securities and cash-flow hedges)
are significantly correlated with stock prices. Cahan, Courtenay, Gronewoller and Upton (2000) using the New Zealand
example, showed that comprehensive income is more value-related than net income. More recent research on that example
(Khan, Bradbury and Courtenay, 2017) revealed that there is an association between returns and comprehensive income,
which is stronger than the association between net income and returns. </p>
<p>Biddle and Choi (2006) suggested that a comprehensive definition of income provides greater decision usefulness, as
well as being correlated with the stock price. Gazzola and Amelio (2014a) concluded that Czech public-listed companies
showing comprehensive income provided more (than net income) information about their financial results and
effectiveness of the company. In other research (Gazzola & Amelio, 2014b), they proved that in a period of crisis,
comprehensive income has <br />a higher information value than the traditional net income. Yousefi, Ahmad and Embong
(2017) found that elements of other comprehensive income are value relevant and positively associated with the stock
price.</p>
<p>The research concluded with Romanian companies, in which Mironiuc and Huian (2016) demonstrated a correlation between
stock price and earnings measured by both net income and comprehensive income.</p>
<p>On the other hand, another study on the Romanian market by Păşcan (2014) showed that the net income association with
stock price is stronger than the comprehensive income association, which means that comprehensive income is not more
value relevant than net income. Some researchers also could not find evidence for the association between
comprehensive income and returns. O’Hanlon and Pope (1999) could not prove that elements of other comprehensive income
are significantly associated with accounting cash flows. Another study on the Iranian stock exchange (Dastgir &
Velashani, 2008) could not confirm that comprehensive income is superior to net income for performance evaluation
based on the stock returns, and could not find evidence that comprehensive income adjustments improve the ability to
reflect firm performance. Rusdiyanto and Narsa (2019) in their research based on banking companies listed on the
Indonesian stock exchange found no evidence of comprehensive income effects on stock prices.</p>
<p>Previous research on Polish context which considered the correlation between comprehensive income and the stock price
was carried out by A Sajnóg (2018), who checked if comprehensive income is correlated with market value more than net
income, but the results were not statistically significant. The more research results by Sajnóg (2020) on the Warsaw
Stock Exchange example have shown that there is <br />a statistically important positive correlation between
comprehensive income and market value, which is not very strong. </p>
<p>Other topics associated with this article, such as predictive power of comprehensive income on the Polish example,
were researched by Bareja, Giedroyć and Wrzosek (2019), who showed that elements of other comprehensive income do not
have a statistically significant influence on future cash flow and future net income. Nevertheless, it was found that
net income, which is an element of comprehensive income has significant predictive power. In that research,
comprehensive income has the distribution of net income which is almost the same as the distribution of comprehensive
income, which means that comprehensive income should have predictive power, just like net income. </p>
<p>Based on previous studies, as well as theoretical aspects of comprehensive income, the author intended to test the
following hypotheses:</p>
<p>H1: There is a relation between comprehensive income and market returns. </p>
<p>H2: Comprehensive income is related to and affects the stock price. </p>
<h2>3. Sample and data collection</h2>
<p>The research took into consideration companies from the energy sector listed on the Warsaw Stock Exchange (companies
included in the WIG-Energia index). The energy sector is considered stable, although in the researched period
write-offs had a significant influence on the companies’ results (Lipski, 2016). The research included elements
recognized in other comprehensive income, The examples of elements of other comprehensive income reported by
researched companies are as follows (names vary):</p>
<ul>
<li>actuarial gains/losses,</li>
<li>re-measurements of defined benefit plans,</li>
<li>measurement of hedging instruments, </li>
<li>foreign exchange differences from translation of foreign entities,</li>
<li>share in other comprehensive income of joint ventures,</li>
<li>valuation of debt financial instruments,</li>
<li>others.</li>
</ul>
<p>This provides a relevant example for research for comprehensive income research.</p>
<p>There are 11 companies in WIG-Energia. Some of them could not be included in the research, thus six companies were
excluded from the sample. The main business area of two companies is outside of Poland (CEZ, INTERAOLT), and because
the author wanted to focus on the Polish market, they were not taken into consideration. Four companies were listed on
the stock market long enough in the period of research (ENERGA, ZEPAK, INTERAOLT and MLSYSTEM), Whereas BEDZIN was
also excluded from the research because the company had not included a Comprehensive income statement in its financial
reports before 2014.</p>
<p>The research sample was built from the financial data of five WIG-Energia companies: PGE, Tauron, ENEA, Kogeneracja,
and Polenergia. To conclude, research addressed financial data like comprehensive income, rate of return and equity
capitalization, and data were collected by the author from annual reports (comprehensive income), the Notoria database
(equity book value, market capitalization, amount of stock issued) and the website stooq.pl (dividends and stock
prices, from which nominal rate of return in periods was calculated).</p>
<p>The timeframe for research was set for the period 2010-2019 (for Tauron who has been listed since June 2010, the
author took into consideration the results for 2011-2019). All data were collected for the fiscal year.</p>
<p>It was difficult to determine in which period earnings and returns should be cumulated. When the tax year equals the
calendar year, the results are considered for the period from 1st January to the end of December, so they should
affect the results in this period. First assumptions about results could be anticipated in interim announcements in
the second half of the year. The first final announcement can be made in March/April of the next year before the
publication of the financial statement for the year. Investors can anticipate the value of shares earlier. Previous
research varied in the assumptions taken, whereas the author assumed that in the long term, earnings are connected
with returns in the associated period. </p>
<h2>4. Research methodology</h2>
<p>The article aimed to check if reported net income influences the market rate of return and the stock price. The
author wanted to ascertain if there is a correlation between comprehensive and stock price, as well as to check if the
market reacts to reported accounting information from financial statements through market returns. The theoretical
concept is based on studies by Easton and Harris (1991), Ohlson (1989), as well as Ball and Brown (1968), who
described that influence in their research and articles. To check the correlation between earnings and stock price,
the author conducted empirical research based on the tools and statistical methods developed by Strong (1993). This
model, to the best of the author’s knowledge has not been used before with comprehensive income reported on the Polish
example.</p>
<p>Previous studies classified earnings as net income. The implementation of IAS 1, has extended, from an accounting
point of view, the perception of financial performance of the business from net income to comprehensive income. </p>
<p>To check if comprehensive income is associated with stock price, the author used the value relevance model based on
Kanagaretman, Mathieu, and Shehata (2009).</p>
<p>There are many methods of stock valuation. According to Ohlson’s (1989) second extreme valuation model, the company
simply trades at market value equal to book value. This refers to the clean surplus concept, which in a simplified
version means that earnings are the difference in book value between periods. Strong (1993) assumed the company trades
at the market-to-book ratio, which indicates that:</p>
<p>Equation 1</p>
<p><span><img src="2021/05-Poniatowski-web-resources/image/3469.png" alt="3469.png" /></span>,</p>
<p>where: Vjt – equity market capitalization of the company, Θ – price/equity book value ratio, B – the equity book
value.</p>
<p>Based on the above, it is possible to assume that the rate of return is indicated by the change in equity book value
in the period, which can be explained by comprehensive income. This results in an equation that relates returns to
earnings levels:</p>
<p>Equation 2</p>
<p><span><img src="2021/05-Poniatowski-web-resources/image/3493.png" alt="3493.png" /></span>,</p>
<p>where: Rjt – rate of return of company j at the end of period t, Vjt – equity market capitalization of company j at
the end of period t, Vjt–1 – equity market capitalization of company j at the end of period t–1 (beginning of period
t), Ejt – comprehensive income (reported earnings on clean surplus basis) of company j in period t.</p>
<p>This equation models earnings as a transitory process (Strong, 1993). Using this assumption, regression can be
created:</p>
<p>Equation 3</p>
<p><span><img src="2021/05-Poniatowski-web-resources/image/3582.png" alt="3582.png" /></span>,</p>
<p>where: Rjt – rate of return of company j at the end of period t, Vjt–1 – equity market capitalization of company j at
the end of period t–1 (beginning of period t), Ejt – comprehensive income (reported earnings on clean surplus basis)
of company j in period t.</p>
<p>To check the direct association between stock price and comprehensive income, the author carried out research using
the Ohlson (1995) valuation model, which shows the investor’s company value as a function of the book value and
residual earnings. This model is described in equation 4 (Kanagaretman et al., 2009):</p>
<p>Equation 4</p>
<p><span><img src="2021/05-Poniatowski-web-resources/image/3597.png" alt="3597.png" /></span>,</p>
<p>where: Vjt – equity market capitalization of company j at the end of period t, Bjt – book value of company j at the
end of period t, Ejt – comprehensive income of company j in period t.</p>
<p>According to this model, market capitalization equals the function of book value at that time and abnormal or
residual earnings. Ohlson assumed that earnings capture all changes in equity (in clean surplus accounting).</p>
<p>Kanagaretman, Mathieu and Shehata (2009) created a value relevance model considering net income and elements of other
comprehensive income. Aggregate comprehensive income was also tested. Due to the aim of the research, which implies
informative power of comprehensive income as general, an empirical model described by Equation 5 was created.</p>
<p>Equation 5</p>
<p><span><img src="2021/05-Poniatowski-web-resources/image/3614.png" alt="3614.png" /></span>,</p>
<p>where: Pjt – price per share of company j at the end of period t, B_Sjt – book value of company j at the end of
period t per share, E_Sjt– comprehensive income of company j in period t per share.</p>
<h2>5. Results and discussion</h2>
<p>The descriptive statistics for sample data are shown in Table 1, where the amounts for comprehensive income market
capitalization and book value are in billions PLN. The number of shares was also considered (with variation due to the
issuance of new shares). The rate of return was calculated with dividends included. </p>
<p><span class="char-style-override-2">Table 1. </span>Descriptive statistics for sample data</p>
<table class="table table-bordered" id="table-1">
<colgroup>
<col />
<col />
<col />
<col />
<col />
<col />
<col />
<col />
<col />
</colgroup>
<tbody>
<tr>
<td>
<p>Variable</p>
</td>
<td>
<p>Mean</p>
</td>
<td>
<p>Standard Error</p>
</td>
<td>
<p>Median</p>
</td>
<td>
<p>Standard Deviation</p>
</td>
<td>
<p>Sample <br />Variance</p>
</td>
<td>
<p>Min</p>
</td>
<td>
<p>Max</p>
</td>
<td>
<p>n</p>
</td>
</tr>
<tr>
<td>
<p>E</p>
</td>
<td>
<p>0.6894</p>
</td>
<td>
<p>0.2144</p>
</td>
<td>
<p>0.1750</p>
</td>
<td>
<p>1.5752</p>
</td>
<td>
<p>2.4812</p>
</td>
<td>
<p>-4.4210</p>
</td>
<td>
<p>4.9856</p>
</td>
<td>
<p>54</p>
</td>
</tr>
<tr>
<td>
<p>V</p>
</td>
<td>
<p>8.7700</p>
</td>
<td>
<p>1.5551</p>
</td>
<td>
<p>4.6792</p>
</td>
<td>
<p>11.4273</p>
</td>
<td>
<p>130.5839</p>
</td>
<td>
<p>0.4040</p>
</td>
<td>
<p>42.3080</p>
</td>
<td>
<p>54</p>
</td>
</tr>
<tr>
<td>
<p>B</p>
</td>
<td>
<p>14.7030</p>
</td>
<td>
<p>2.2193</p>
</td>
<td>
<p>11.4695</p>
</td>
<td>
<p>15.5351</p>
</td>
<td>
<p>241.3383</p>
</td>
<td>
<p>0.3032</p>
</td>
<td>
<p>46.7270</p>
</td>
<td>
<p>49</p>
</td>
</tr>
<tr>
<td>
<p>R</p>
</td>
<td>
<p>-0.0310</p>
</td>
<td>
<p>0.0378</p>
</td>
<td>
<p>-0.0619</p>
</td>
<td>
<p>0.2648</p>
</td>
<td>
<p>0.0701</p>
</td>
<td>
<p>-0.5971</p>
</td>
<td>
<p>0.6872</p>
</td>
<td>
<p>49</p>
</td>
</tr>
<tr>
<td>
<p>P</p>
</td>
<td>
<p>26.2700</p>
</td>
<td>
<p>3.5615</p>
</td>
<td>
<p>18.8890</p>
</td>
<td>
<p>24.9302</p>
</td>
<td>
<p>621.5146</p>
</td>
<td>
<p>1.6400</p>
</td>
<td>
<p>109.9000</p>
</td>
<td>
<p>49</p>
</td>
</tr>
</tbody>
</table>
<p>E − comprehensive income, V − market capitalization, B − book value, R − rate of return, P − price per share</p>
<p>Source: own work.</p>
<p>To obtain all necessary regression analysis variables, the data was transformed. All the variables are shown in Table
2.</p>
<p>Table 2<span class="char-style-override-2">. </span>Descriptive statistics for research data</p>
<table class="table table-bordered" id="table-2">
<colgroup>
<col />
<col />
<col />
<col />
<col />
<col />
<col />
<col />
<col />
</colgroup>
<tbody>
<tr>
<td>
<p>Variable</p>
</td>
<td>
<p>Mean</p>
</td>
<td>
<p>Standard Error</p>
</td>
<td>
<p>Median</p>
</td>
<td>
<p>Standard Deviation</p>
</td>
<td>
<p>Sample <br />Variance</p>
</td>
<td>
<p>Min</p>
</td>
<td>
<p>Max</p>
</td>
<td>
<p>n</p>
</td>
</tr>
<tr>
<td>
<p>Ejt/Vjt-1</p>
</td>
<td>
<p>0.0756</p>
</td>
<td>
<p>0.0147</p>
</td>
<td>
<p>0.0978</p>
</td>
<td>
<p>0.1026</p>
</td>
<td>
<p>0.0105</p>
</td>
<td>
<p>-0.2423</p>
</td>
<td>
<p>0.2781</p>
</td>
<td>
<p>49</p>
</td>
</tr>
<tr>
<td>
<p>B_S</p>
</td>
<td>
<p>35.0269</p>
</td>
<td>
<p>4.0112</p>
</td>
<td>
<p>24.7388</p>
</td>
<td>
<p>28.0779</p>
</td>
<td>
<p>788.3701</p>
</td>
<td>
<p>8.9198</p>
</td>
<td>
<p>104.480</p>
</td>
<td>
<p>49</p>
</td>
</tr>
<tr>
<td>
<p>E_S</p>
</td>
<td>
<p>2.1494</p>
</td>
<td>
<p>0.4265</p>
</td>
<td>
<p>1.5186</p>
</td>
<td>
<p>2.9852</p>
</td>
<td>
<p>8.9113</p>
</td>
<td>
<p>-2.4235</p>
</td>
<td>
<p>10.6130</p>
</td>
<td>
<p>49</p>
</td>
</tr>
</tbody>
</table>
<p>E − comprehensive income of company j in period t, V − market capitalization of company j at the end of period t–1,
B_S – book value per share, E_S − comprehensive income per share</p>
<p>Source: own work.</p>
<p>The relation between returns and comprehensive income, which is the object of the first hypothesis was tested by
regression based on Equation 3. The results of the regression analysis of the relation between returns and
comprehensive income divided by market capitalization (from the beginning of the period) showed that there is an
average (0.398) correlation between those variables. The adjusted R^2 of that model is 0.140499683. The coefficient of
Ejt/Vjt–1 is approximately 1.03 and is significant on a 0.01 level. </p>
<p>The second hypothesis is the relation between comprehensive income and stock price. To determine if comprehensive
income is associated and affects stock price, the value relevance model was applied, and the correlation between
variables was analysed. The results are presented in Table 4.</p>
<p>Table 3<span class="char-style-override-2">. </span>Tests of relations between market returns and comprehensive
income</p>
<table class="table table-bordered" id="table-3">
<colgroup>
<col />
<col />
<col />
</colgroup>
<tbody>
<tr>
<td>
<p>Variable</p>
</td>
<td>
<p>Coefficient</p>
</td>
<td>
<p>t stat</p>
</td>
</tr>
<tr>
<td>
<p>Intercept</p>
</td>
<td>
<p>-0.10932018</p>
</td>
<td>
<p>-2.5003**</p>
</td>
</tr>
<tr>
<td>
<p>Ejt/Vjt–1</p>
</td>
<td>
<p>1.026891091</p>
</td>
<td>
<p>2.97429***</p>
</td>
</tr>
<tr>
<td>
<p> </p>
</td>
<td>
<p> </p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>No of observations</p>
</td>
<td>
<p>49</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>R</p>
</td>
<td>
<p>0.398002438</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>R^2</p>
</td>
<td>
<p>0.158405940</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>Adjusted R^2</p>
</td>
<td>
<p>0.140499683</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>F value</p>
</td>
<td>
<p>8.8464018***</p>
</td>
<td>
</td>
</tr>
</tbody>
</table>
<p>** p-value < 0.05 </p>
<p>*** p-value < 0.01</p>
<p>Source: own work.</p>
<p>Results show that there is a relation between comprehensive income and stock returns. The results correspond with the
previous research based on this model (Strong, 1993) as well as the results obtained using the value relevance model
(Kanagaretnam et al., 2009).</p>
<p>Table 4<span class="char-style-override-2">. </span>Correlation matrix</p>
<table class="table table-bordered" id="table-4">
<colgroup>
<col />
<col />
<col />
<col />
</colgroup>
<tbody>
<tr>
<td>
<p>P</p>
</td>
<td>
<p>B_S</p>
</td>
<td>
<p>E_S</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>1</p>
</td>
<td>
<p>0.803686</p>
</td>
<td>
<p>0.804329</p>
</td>
<td>
<p>P</p>
</td>
</tr>
<tr>
<td>
</td>
<td>
<p>1</p>
</td>
<td>
<p>0.736776</p>
</td>
<td>
<p>B_S</p>
</td>
</tr>
<tr>
<td>
</td>
<td>
</td>
<td>
<p>1</p>
</td>
<td>
<p>E_S</p>
</td>
</tr>
</tbody>
</table>
<p>Source: own work.</p>
<p>There is a strong correlation between price and comprehensive income. A similar correlation occurs between book value
and price, which means that both variables are strongly associated with the stock price. To determinate the
association between the variables, the value relevance model was used. The regression based on Equation 5 was created:
</p>
<p>Table 5<span class="char-style-override-2">. </span>Tests of association between book value, comprehensive income and
stock price</p>
<table class="table table-bordered" id="table-5">
<colgroup>
<col />
<col />
<col />
</colgroup>
<tbody>
<tr>
<td>
<p>Variable</p>
</td>
<td>
<p>Coefficient</p>
</td>
<td>
<p>t stat</p>
</td>
</tr>
<tr>
<td>
<p>Intercept</p>
</td>
<td>
<p>3.582982343</p>
</td>
<td>
<p>1.190576</p>
</td>
</tr>
<tr>
<td>
<p>E_S</p>
</td>
<td>
<p>3.876274055</p>
</td>
<td>
<p>4.210123***</p>
</td>
</tr>
<tr>
<td>
<p>B_S</p>
</td>
<td>
<p>0.409949223</p>
</td>
<td>
<p>4.187973***</p>
</td>
</tr>
<tr>
<td>
<p> </p>
</td>
<td>
<p> </p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>No of observations</p>
</td>
<td>
<p>49</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>R</p>
</td>
<td>
<p>0.862786848</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>R^2</p>
</td>
<td>
<p>0.744401145</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>Adjusted R^2</p>
</td>
<td>
<p>0.733288151</p>
</td>
<td>
</td>
</tr>
<tr>
<td>
<p>F value</p>
</td>
<td>
<p>66.98475367***</p>
</td>
<td>
</td>
</tr>
</tbody>
</table>
<p>***p-value < 0.01</p>
<p>Source: own work.</p>
<p>The built regression model is well-fitted on the example data. The adjusted R^2 equals 0.733, meaning that it has a
satisfactory explanatory value. Both book value and comprehensive income coefficient are statistically significant on
a 1% level. The results of the analysis prove that comprehensive income is associated with and affects stock price.
The comprehensive income coefficient was estimated at approximately 3.88. The results of the regression analysis
correspond with the previous research results based on other data sample from different markets. </p>
<h2>6. Conclusion</h2>
<p>The use of comprehensive income in financial analysis has both its opponents as well as supporters. The opponents
point out that other comprehensive income components include non-operational and not permanent income concepts,
therefore they do not show the performance of a company. On the other hand, comprehensive income proponents say that
the inclusion of items which potentially can be relevant, provides more information for financial statement users.</p>
<p>Based on research provided in this article, one can assume that comprehensive income and returns of stocks are
connected, and that comprehensive income is related to the stock price in the energy sector. </p>
<p>The results of this article are in line with previous research. As with most previous studies, it shows that there is
an association between stock price and earnings when earnings were described by comprehensive income or net income.
According to many researchers, net income (which is an element of comprehensive income) influences stock price.
Numerous previous studies compared net income with comprehensive income. The results vary depending on methodology and
researched companies/markets, but generally these results confirm the author’s conclusions, which prove that
comprehensive income is associated with the stock price. The results of association between comprehensive income and
returns are also similar to those previously obtained. The returns are not as strongly associated with comprehensive
income, as the association between comprehensive income and stock price, nevertheless there is an association between
those categories.</p>
<p>Future research should include more companies from different sectors. This research was limited to only one energy
sector. A longer period can also be applied, as well as other statistical methods.</p>
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<p>Wynik całkowity a cena akcji na przykładzie spółek<br />z branży energetycznej</p>
<p>Streszczenie: Wyniki finansowe są głównym źródłem informacji dla inwestorów giełdowych. Rada Międzynarodowych
Standardów Rachunkowości zmieniła podstawowe zasady dotyczące oceny działalności przedsiębiorstwa, przyjmując wynik
całkowity, a nie zysk netto, jako podstawową kategorię oceniającą efektywność prowadzonej działalności. Przedmiotem
dotychczasowych badań pod kątem przydatności wyników finansowych do analizy finansowej oraz powiązania tych wyników ze
stopą zwrotu oraz ceną akcji był zysk/strata netto. Wyniki tych badań nie są jednak spójne. Wyniki całkowite nie były
szeroko analizowane w takim aspekcie. Artykuł poświęcony jest analizie zależności pomiędzy wynikiem całkowitym a ceną
akcji spółek energetycznych notowanych na Giełdzie Papierów Wartościowych w Warszawie w latach 2010-2019. Autor
przedstawił aspekty teoretyczne oraz prawne zagadnienia koncepcji dochodu całkowitego oraz zbadał wpływ całkowitych
dochodów na cenę akcji i stopy zwrotu, stosując podejście ilościowe. </p>
<p>Słowa kluczowe: wynik całkowity, dochód całkowity, cena akcji, sprawozdanie z całkowitych dochodów, clean surplus.
</p>