This study provides international empirical evidence for the asymmetric cost behavior of the cost of goods sold and the operating expenses in the context of the European non-listed firms. We employ a data sample of 4,177,625 firm years observations from Amadeus Database for the period 2009-2017...

We study the effect of growth in firms’ balance sheets on stock returns by decomposing asset growth into two components, one that captures real investment growth and one that captures accounting distortions and/or reduced efficiency. We show that these components play significant and...

Consistent with the implications of conditional conservatism, we show that the differential persistence of cash flows relative to that of accruals is higher across loss firms than profit firms. Further, we find that the positive relation of cash flows with future returns is more severe in loss...

Using the percent accrual measure proposed by Hazfalla et al. (2011), we empirically evaluate the predictions of earnings fixation hypothesis and limits to arbitrage hypothesis on the accrual anomaly in the U.K. stock market. We show a strong negative relation of percent accruals with future...