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A new measure of managers' intentional income smoothing
Black, Dirk; Pierce, Spencer; Thomas, Wayne B. - 2017
The purpose of our study is to further understand managerial incentives that affect the volatility of reported fiscal-year earnings. We do this by examining income smoothing based on pseudo fiscal years. For each firm, we create pseudo-year earnings using four consecutive quarters other than the...
Persistent link: https://www.econbiz.de/10011756894
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Individual large shareholders, earnings management, and capital-market consequences
Dou, Yiwei; Hope, Ole-Kristian; Thomas, Wayne B.; Zou, Youli - In: Journal of business finance & accounting : JBFA 43 (2016) 7/8, pp. 872-902
Persistent link: https://www.econbiz.de/10011627655
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Abnormal Accrual Estimates and Evidence of Mispricing
Cheng, C.S. Agnes - 2011
To estimate abnormal accruals, prior research employs a wide variety of models and estimation procedures. We evaluate the performance of three representative models – modified Jones model (MJ), MJ with operating cash flows (MJOCF), and MJ with return on assets (MJROA) – and two estimation...
Persistent link: https://www.econbiz.de/10013117916
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Blockholder Exit Threats and Financial Reporting Quality
Dou, Yiwei - 2016
Recent theoretical and empirical studies suggest that blockholders (shareholders with ownership ≥ 5%) exert governance through the threat of exit. Blockholders have strong incentives to gather private information and sell their shares when managers are perceived to underperform. To prevent...
Persistent link: https://www.econbiz.de/10013006858
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Individual Large Shareholders, Earnings Management, and Capital Market Consequences
Dou, Yiwei - 2016
Using a large hand-collected sample of all blockholders (ownership ≥ 5%) of S&P 1500 firms for the years 2002–2009, we first document significant individual blockholder effects on earnings management (accrual-based earnings management, real earnings management, and restatements). This...
Persistent link: https://www.econbiz.de/10013007435
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Earning Management : Do Firms Play 'Follow the Leader'?
Bratten, Brian - 2016
In this study we examine whether the reported performance of one firm affects the discretionary reporting behavior of another firm. We do this by identifying the leader within each industry, defined as the first large announcing firm. We find that the discretionary performance of followers...
Persistent link: https://www.econbiz.de/10013008024
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The Market’s Reaction to Unexpected Earnings Thresholds
Herrmann, Don - 2010
earnings thresholds – reporting a profit, reporting an increase in earnings, and meeting analysts' forecasts. In contrast to … prior research, the research design identifies the incremental market reaction to the profit and earnings increase …-related incentives to manage earnings at the profit and earnings increase thresholds suggests either that managers have other incentives …
Persistent link: https://www.econbiz.de/10013139531
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A Test of the Market’s Mispricing of Domestic and Foreign Earnings
Thomas, Wayne B. - 2011
This study investigates whether abnormal returns can be earned using public information about firms' domestic and foreign earnings. The results indicate that the market understates foreign earnings' persistence. As a result, it is possible to construct a zero-investment hedge portfolio that...
Persistent link: https://www.econbiz.de/10013117470
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Managerial Equity Holdings and Income Smoothing Incentives
Shu, Sydney Qing - 2017
Our study explores how managerial stock holdings and option holdings affect CEOs' income smoothing incentives. Given the different roles of stock holdings and option holdings in solving agency problems, managers may smooth past earnings using discretionary accruals for the purpose of revealing...
Persistent link: https://www.econbiz.de/10012971185
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The Market’s Reaction to Unexpected Earnings Thresholds
Herrmann, Don - 2010
earnings thresholds – reporting a profit, reporting an increase in earnings, and meeting analysts' forecasts. In contrast to … prior research, the research design identifies the incremental market reaction to the profit and earnings increase …-related incentives to manage earnings at the profit and earnings increase thresholds suggests either that managers have other incentives …
Persistent link: https://www.econbiz.de/10013144414