Amir, Eli; Einhorn, Eti; Kama, Itay - In: European Accounting Review 22 (2013) 4, pp. 685-718
Revenues and expenses are fundamentally proportional to one another, but are likely to be disproportionally affected by transitory items or economic shocks. We build on this observation and propose a new measure of sustainable earnings based on deviations from normal profit margins. While some...