— In this paper, based on the sample of 97 corporations the authors analyzed the value relevance of accounting information on the capital markets of Southeast Europe. In the first part of the research authors analyzed and compared value relevance on the following capital markets: Ljubljana Stock Exchange, Zagreb Stock Exchange, Sarajevo Stock Exchange, Banja Luka Stock Exchange and Belgrade Stock Exchange. The research results have shown that the accounting information are value relevant on all the observed markets but also that there are certain differences in the value relevance among countries. In the second part of the research authors tested the hypothesis that level of transparency is positively related with value relevance i.e. higher transparency of annual report should result with higher value relevance of accounting information. According to the empirical research hypothesis is confirmed since it is possible to distinguish companies that belong to group of countries with lower value relevance from those that belong to group of countries with higher value relevance based on data about transparency level, i.e. IFR score.  accounting information, international differences, transparency, value relevance. I. INTRODUCTION NE of the fundamental objectives of financial accounting is to meet the information needs of investors on capital markets. In this context the value relevance studies present a line of research which analyses the usefulness of accounting information in the process of decision making. Namely, accounting information is considered value relevant if it is associated with share prices. If this relationship does not exist it can be concluded that accounting information are not value relevant or that financial statements do not meet one of its primary goals. In the literature the concept of value relevance is defined in different ways. According to Beaver [1] accounting information is value relevant if it is associated to market value of equity (with shares or returns). Similarly, in [2] it is stated that "          ". Value relevance studies represent the most productive area in accounting research in I. Pervan is with University of Split, Faculty of Economics, Cvite Fiskovica 5, 21000 Split, Croatia (phone: 385>21>430>639; fax: 385>21>430> 701; e>mail: pervan@efst.hr). M. Bartulovic is with University of Split, Center for professional studies, Livanjska 5, 21000 Croatia (e>mail: mvasilj@oss.unist.hr). the last 20 years and they are conducted in most of developed countries. In recent years in the area of value relevance research focus is on comparing the value relevance of accounting information among different countries and on determining the factors that cause the observed differences. Specifically, nowadays when the processes of internationalization and globalization are becoming more important the problem of financial statements comparability is becoming more expressed and some researchers consider how the free market international accounting reform can be looked as a part of a problematic globalization process [3]. Financial information that is universally understood and comparable should improve relations between various users of financial statements such as bankers, investors, etc. But it is also important to state that application of International Financial Reporting Standards (IFRS) is determined in each EU country through a wide range of political, historical and cultural barriers [4], [5]. Transition countries of South and East Europe are characterized by preparing financial statements for fiscal and other purposes of the state authorities and there still exists distinction between financial accounting for external users and management accounting in greater extent than it is common in developed countries [6]. In order to achieve harmonization in financial reporting and thus reduce the differences in the value relevance of accounting information since 2005 the use of IFRS is mandatory for all the companies whose shares are listed on the capital markets of EU. Such regulation is aimed to achieve approximately equal value relevance of accounting information, but existing research [7], [8], [9], [10], [11] show that despite of financial reporting harmonization certain differences still exist. In this paper authors analyze impact of transparency level on value relevance of accounting information. More precisely, authors test the hypothesis that the level of transparency is related with value relevance of accounting information and assume that it is possible to differentiate companies that belong to group of countries with lower value relevance from those that belong to group of countries with higher value relevance based on data about transparency level, i.e. about IFR score. The contribution of this paper to the existing literature in this area is in conducting a value relevance study on new, transition capital markets where the practice of conducting such studies does not still exist. Impact of transparency level on the value relevance of accounting information: empirical analysis for SEE countries I. Pervan and M. Bartulović O INTERNATIONAL JOURNAL OF MATHEMATICAL MODELS AND METHODS IN APPLIED SCIENCES Issue 8, Volume 6, 2012 955