Managerial estimates are ubiquitous in accounting: most balance sheet and income statement items are based on estimates; some, such as the pension and employee stock options expenses, derive from multiple estimates. These estimates are affected by objective estimation errors, as well as by...

We conduct a fundamental analysis of detailed financial information to predict earnings. Since 2012, all U.S. public companies must tag quantitative amounts in financial statements and footnotes of their 10-K reports using the eXtensible Business Reporting Language (XBRL). Leveraging machine...

We use machine learning methods and high-dimensional detailed financial data to predict the direction of one-year-ahead earnings changes. Our models show significant out-of-sample predictive power: the area under the receiver operating characteristics curve ranges from 67.52% to 68.66%,...