Price Earnings- and Market Book-ratios presume a systematic link between financial statement data and company value. We analyze this relationship in a steady state model with overlapping capacity investments where company value is inferred from a constant growth residual income model. We...

We assess the role of both accruals manipulation (AM) and real activities manipulation (RAM) in inducing overvaluation at the time of a seasoned equity offering (SEO). Our results reveal that earnings management is most consistently and predictably linked with post-SEO stock market...

This paper investigates how manipulating different earnings components will affect the likelihood of accounting-related shareholder litigation. Firms can manipulate earnings upward by accelerating revenue recognition, understating expenses, and overstating gains associated with special items....