Researchers have used various measures as indications of "earnings quality" including persistence, accruals, smoothness, timeliness, loss avoidance, investor responsiveness, and external indicators such as restatements and SEC enforcement releases. For each measure, we discuss causes of...

Recent years have seen an increase in takeover activity in the Australian share market. During this time several of the more active investors have been assigned the image of “corporate raider†by the media. This study looks at the share market reaction to seven such investors, namely,...

A number of recent U.S. studies have documented positive abnormal returns on, and in the period immediately surrounding, the day stocks trade “ex†stock dividends and splits. This paper investigates return behaviour on and around the ex-days of similar Australian capitalisation...

Accounting earnings summarize periodic corporate financial performance and are key determinants of stock prices. We review research on the usefulness of accounting earnings, including research on the link between accounting earnings and firm value and research on the usefulness of accounting...

We show that accruals consist of at least two distinct underlying processes, one with positive serial correlation and the other with negative serial correlation. We also find that the accrual reversals characterizing the negatively serially correlated process are predominantly good accruals that...

<heading id="h1" level="1" implicit="yes" format="display">ABSTRACT</heading>Prior research shows that the cash component of earnings is more persistent than the accrual component. We decompose the cash component into: (1) the change in the cash balance, (2) issuances/distributions to debt, and (3) issuances/distributions to equity. We find that the higher...