In response to a string of highly publicized corporate scandals, the US Congress passed the Sarbanes-Oxley Act (SOX) on July 30, 2002, with the intention to restore investors' confidence in financial and public reporting. This study addresses the question of whether any improvement in earnings...

This paper extends the growing literature on factors affecting cross-sectional and intertemporal variation in earnings response coefficients. It tests the empirical implications of recent theoretical work by Choi and Salamon (1989) and Holthausen and Verrecchia (1988), who model the degree of...

The purpose of this study is to examine empirically how the presence of earnings management may affect firm valuation. We compare the performance of earnings-based (e.g., Residual Income Model, RIM) and non-earnings-based (e.g., Discounted Cash Flow, DCF) valuation models, measured by absolute...