Residual income-based valuation is conventionally carried out using forecasts of residual incomes that are derived from historical cost accounting numbers and discounted at the nominal cost of equity. A recent study by Ritter and Warr (2002) argues that this practice can lead to undervaluation...

This paper extends the residual income-based valuation framework to encompass an articulation between (i) value created for a firm's shareholders beyond the cost of their invested capital (excess value created) during a multi-period interval and (ii) a matching cumulation of the firm's residual...

UK GAAP has traditionally allowed the write-off of purchased goodwill directly to reserves, resulting in the widespread depletion of book equity. Companies have also been permitted to revalue fixed assets at management's discretion. This study examines whether upward revaluations have been...

UK GAAP has traditionally allowed the write-off of purchased goodwill directly to reserves, resulting in the widespread depletion of book equity. Companies have also been permitted to revalue fixed assets at management's discretion. This study examines whether upward revaluations have been...