This essay is based on a keynote speech at the 2014 Journal of International Accounting Research (JIAR) Conference. That talk was built upon a 2009 American Accounting Association (AAA) annual meeting panel presentation titled “Is there any scientific legitimacy to what we teach in Accounting...

Taiwan is an economy with an efficient stock market where accounting and auditing standards generally follow the US. However, a culturally different climate is caused by the predominance of family-owned public companies. We find Taiwanese firms' earnings exhibit the conservatism and timeliness...

We theorize that accounting systems affect analysts' forecast accuracy through changes in earnings variability. We argue that the matching and historical cost principles reduce earnings variability, and hence, reduce analysts' earnings forecast errors. We also argue that restricting the choice...

Auditors' incentives to be conservative are likely to vary both cross-sectionally and over time based on their legal liability exposure. We predict that Big Eight (Six/Five) auditors are likely to be more conservative than non-Big Eight Auditors. We show that the earnings reported by Big Eight...

An examination of analysts' accuracy in predicting annual earnings for firms reporting losses and firms reporting profits finds that analysts are ten times more accurate in predicting the earnings of profit firms. They have also improved their predictive ability for profit firms since the...

Pope and Walker examine differences in the timeliness and conservatism of U.S. and U.K. reported earnings. They conclude that the U.S. accounting regime appears significantly more conservative than the U.K. regime, when comparing earnings before extraordinary items. However, when comparing...

Sivakumar and Waymire examine differences in the properties of US railroads' reported earnings before and after concurrent changes in accounting rules and rate regulations. Although the accounting rules were intended to combat income smoothing, Sivakumar and Waymire find little evidence that...

Chambers, Freeman and Koch test to see whether earnings response coefficients (ERCs), or stock returns per unit of unexpected earnings, are increasing in total risk. They generate this prediction from a model in which the sensitivity of dividend expectations to earnings news increases in total...

Giner & Rees (2001) report that the asymmetry in the timeliness of earnings decreases as one moves across the U. K., France and Germany. These results are similar to those previously predicted and reported by Ball, Kothari & Robin (2000). The authors extend this prior research by examining the...