The purpose of this paper is to investigate the value relevance of the legally mandated provisions. This paper examines the effects of changes in provisions on the value relevance of earnings. The results show that the calculation of provisions will deteriorate the relevance of earnings when the changes in provisions may artificially and mechanically smooth earnings. However, the provision for railroad maintenance functions as a allocation method of operating revenues and the provision for insurance payment functions as a allocation method of operating expenses. These provisions seem to improve the value relevance of earnings. Therefore, we cannot discriminate against the legally mandated provisions for the very reason that their calculation is formally restricted. Whether provision is legally mandated or not, we still have many unresolved problems about provisions on the disclosure in the balance sheet and on the calculation in the income statement.