This study investigates the effect of a security regulation that occurs concomitantly with International Financial Reporting Standards (IFRS) adoption on the information content of earnings announcements in Italy. To identify the effect of this regulation, we use a treatment (i.e., Italy) and a...

We use highly granular computational linguistics to assess the MD&A section of the 10-K as a whole. Our results show that the content of MD&A can be systematically used to explain the valuation of firms, particularly those undergoing business change, where the value relevance of financial...

Recent work shows that the role of accrual accounting in mitigating the timing differences between cash flows and operating performance has been disappearing over time (Bushman, Lerman, and Zhang 2016). We argue that even though there is noise in the accrual accounting process, sophisticated...

This study examines the predictive power of comprehensive income and its individual components within the homogenous institutional setting of German IFRS firms. The results could be relevant for the standard setters IASB and FASB and their joint project “Financial Statement Presentation”. We...

We examine whether the mandatory adoption of International Financial Reporting Standards (IFRS) has changed the usefulness of accounting information in predicting future earnings and cash flows out-of-sample. Using a sample of firms from European Union countries that mandatorily adopted IFRS in...

Managers are often employed many alternatives for earnings management following their objectives or the financial reporting objectives; the commonly used are the accrual-based and cash-based earnings management. The literature reveals that managers adopt the two strategies in different ways,...

This teaching guide is based on a comprehensive survey as well as in-depth interviews of Chief Financial Officers (CFOs). We ask the CFOs about the definition and drivers of earnings quality, with a special emphasis on the prevalence and detection of earnings misrepresentation. CFOs believe that...

This paper examines whether issuing management earnings guidance motivates a firm to raise its level of performance. The failure of management to attain a forecast may reflect poorly on its industry understanding, knowledge of the firm, and management capability. Accordingly, we hypothesize and...

Paper's objectives: The main aim of the paper is to analyze the earnings quality of high-share liquidity companies from Poland, Romania, and Hungary whose activities are outside the finance sector. Methods applied: Earnings quality, i.e., earnings persistence, predictability, and accruals...