Roll (1988) observes low R2 statistics for common asset pricing models due to vigorousfirms-specific returns variation not associated with public information. He concludes (p. 56) that this implies acirc;not;Seither private information or else occasional frenzy unrelated to concrete...

This paper presents both a new approach to studying the consequences of accounting choice and a unique sample to examine the effects of accounting choice in the Ramp;D context. We investigate the effect of firms' decision to capitalize Ramp;D expenditures on the amount of information about...

Roll [1988] observes low R2 statistics for common asset pricing models due to vigorous firms-specific return variation not associated with public information. He concludes (p. 56) that this implies quot;either private information or else occasional frenzy unrelated to concrete information.quot;...

We examine the association between voluntary corporate disclosure and the informativeness of stock prices. We measure corporate disclosure using the AIMR-FAF annual corporate disclosure ratings. We define price informativeness by the association between current stock returns and future earnings...

This paper presents a new approach to studying the effects of earnings management, by testing whether income smoothing, a particular form of earnings management, is associated with more informative stock prices. Stock price informativeness is defined as the amount of information about future...

Range forecasts have evolved to be the most common form of management forecasts. Prior studies typically use the midpoint to evaluate analyst reaction to range forecasts, implicitly assuming that analysts place equal weights on the upper and the lower bounds of management range forecasts. We...

This paper tests whether the stock market overreacts to extreme earnings, by examining firms' stock returns over the thirty-six months subsequent to extreme earnings years. While the poorest earners do outperform the best earners, the poorest earners are also significantly smaller than the best...

This study investigates the direct effects of corporate diversification on accounting reports, and the implications of these effects for accounting research. The study shows that firms which diversify into unrelated areas of business devote a larger proportion of their capital investments to...