Total Comprehensive Earnings and Corporate Value with Fundamental Macroeconomic as Moderation : South East Asia Evidence

Abstract

The purpose of this study is to demonstrate the effect of total comprehensive earnings (TCE) on corporate value (CV) and to demonstrate the moderation of macroeconomic fundamentals (FME) in the relationship between TCE and CV. This study uses 1,341 firm-year observational data from the financial statements of 3,878 companies in the largest capital markets in five Southeast Asian countries. Hypotheses were tested using moderated regression analysis. The results indicate that TCE has a positive effect on CV, and FME strengthens the positive effect of TCE on FME. These results support the signaling theory (Spence) and the earnings content theory (BB 68), which states that high TCE is a positive signal from management to market participants that the company has the potential to receive comprehensive income, both realized and unrealized income, which represents the impact of FME on financial performance.