Bird, Karolyi, and Ruchti (2019) estimate a structural model of earnings management in the setting of meeting-or-beating the analyst consensus forecast. I provide an overview of their methods and findings, and then discuss the assumptions, benefits, and limitations of their approach

Using a novel dataset, we show that components of firms' GAAP earnings stemming from ancillary business activities or transitory shocks are significant in frequency and magnitude. These components have grown over time and are dispersed across various sections of the 10-K. Excluding them from...

Recent work shows that the role of accrual accounting in mitigating the timing differences between cash flows and operating performance has been disappearing over time (Bushman, Lerman, and Zhang 2016). We argue that even though there is noise in the accrual accounting process, sophisticated...

This study examines whether the information on capitalization of intangible assets improves the precision of analysts' forecasts after the adoption of IFRS 3 and IAS 38 for Asian firms. In addition, we investigate whether the forecast relevance of intangible assets information guided by IFRS 3...

We study how securities analysts influence managers' use of different types of earnings management. To isolate causality, we employ a quasi-experiment that exploits exogenous reductions in analyst following resulting from brokerage house mergers. We find that managers respond to the coverage...

Using a sample of firms that have consecutive earnings growth for more than 20 quarters (earnings strings), I assess the relationship between earnings persistence and the extent to which investors are able to anticipate breaks of earnings strings. I find that firm-specific earnings persistence...

We examine how analysts' earnings forecast properties vary when accounting information is more difficult to process. Specifically, we investigate whether analysts' forecast properties are associated with traditional real earnings management (REM) measures. We hypothesize and find that analysts'...

The aim of our study is to determine, within the area of Listed Spanish companies, whether analyst forecasts constitute an incentive to manage earnings (upwards to achieve them or downwards to avoid exceeding them) and whether this incentive acquires the same or different importance for the...

We investigate how interactions between analysts and managers influence (1) analyst disagreement about the definition of forecasted street earnings and (2) shifts in the definition of actual street earnings. Textual analysis of conference call transcripts indicates that more discussion about...

This paper provides evidence on the net stock price effects associated with managers following a disclosure strategy of guiding earnings down to a level where they can report a positive earnings surprise. Prior literature documents a stock price premium when firms meet or beat analysts'...