A Study on the Information Content of Employee Bonus

• Main Authors: Cheng-Chien Lee, 李誠謙
• Other Authors: YU-CHIH, LIN
• Format: Others
• Language: zh-TW
• Published: 2003
• Online Access: http://ndltd.ncl.edu.tw/handle/84963529037203865391

碩士 === 逢甲大學 === 會計與財稅所 === 91 === A series of business scandals starting with the Enron case arouses attention and discussion about many companies in America. This case also affects the companies in Taiwan. With the continual criticism, the compensation of top managements become the major reason for the insufficient transparency of companies. People query the employee stock option plans in America and also doubt the profit sharing and employee stock ownership plans in Taiwan. As modern accounting theory is concerned, wages paid monthly, year-end bonuses and stock bonuses are all regarded as the compensation for employees. In nature, employee bonus is expense not the distribution of the earnings which is current accounting practice in Taiwan. This difference is also questioned by foreign investors. The employee bonus is the distribution of earnings or the expense of corporation? If employee bonus is the expense of corporation, it should be valued at par value or market value? These issues have been discussed thoroughly. To trace to its source, this thesis aims to find out whether employee bonus has the information content and what it plays in the Taiwan’s stock market. This thesis analyzes employee bonus of local listing companies from 1999 to 2001. These companies are classified as electronics industry and non-electronics industry. This study shows that the employee bonus has the information content and has a positive relationship with the cumulative abnormal return (CAR). The result explains that investors have positive perspectives about the employee bonus.