Download or read book Exploring Managers Accrual Related Forecast Bias written by Sami Keskek and published by . This book was released on 2017 with total page 53 pages. Available in PDF, EPUB and Kindle. Book excerpt: In this study, we examine the effect of accrual-based earnings management on the association between managers' earnings forecast errors and accruals, which we label “managers' accrual-related forecast bias.” We build on extensive research which finds that managers engage in accrual-based earnings management to meet or beat earnings benchmarks and report smooth earnings series. We hypothesize that managers bias their subsequent-year forecasts in the direction of accruals management to increase market confidence in the managed earnings numbers. Consistent with our expectations, we find a positive association between managers' earnings forecast errors and discretionary accruals, but no association between managers' earnings forecast errors and nondiscretionary accruals. Furthermore, the association between managers' earnings forecast errors and discretionary accruals is stronger when managers have limited ability to continue managing subsequent-year accruals to support the bias in their forecasts. We also find a substantial decline in managers' accrual-related forecast bias following the enactment of the Sarbanes-Oxley Act of 2002 (SOX), which restricted managers' use of accrual-based earnings management. More importantly, we find that the effect of forecasting difficulty on managers' accrual-related forecast bias occurs only in the pre-SOX period. Overall, our results suggest that, contrary to claims in prior research, managers' accrual-related forecast bias is not simply a product of forecasting difficulty related to accruals. Rather, at least in some cases, it appears to be intentional.

Download or read book Management Bias Across Multiple Accounting Estimates written by Timothy A. Seidel and published by . This book was released on 2019 with total page 69 pages. Available in PDF, EPUB and Kindle. Book excerpt: We examine whether managers appear to aggregate bias in multiple subjective accrual estimates to meet or just beat analyst expectations. We also consider whether the updated language in recent PCAOB auditing standards, focusing auditors on the potential for bias across multiple estimates, impacted this method of managing earnings. Using hand-collected data from a sample of manufacturing firms, we find that meeting or just beating the most recent consensus analyst earnings forecast is positively associated with income-increasing bias aggregated from multiple accounting estimates. We also find that this relation attenuates in the years following the issuance of PCAOB auditing standards focusing auditors on this issue. Further analyses reveal that after these standards were released, firms increased the use of income-increasing, unexpected non-GAAP exclusions to meet or just beat expectations, an alternative technique subject to less auditor scrutiny. Additionally, firms using bias from multiple accounting estimates after the updated guidance in these PCAOB standards do so using bias spread in smaller amounts across more individual estimates. These findings provide important insight into how managers use accruals to meet or just beat an important benchmark as well as the impact of PCAOB auditing standard updates on this earnings management practice.

Download or read book The Association Between Management Earnings Forecast Errors and Accruals written by Guojin Gong and published by . This book was released on 2008 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: We investigate the association between errors in management forecasts of subsequent year earnings and current year accruals. In an uncertain operating environment, managers' assessments of their firms' business prospects are imperfect. Since managers' imperfect business assessments influence both accruals generation and earnings projection, we hypothesize that management earnings forecasts exhibit greater optimism (pessimism) when accruals are relatively high (low). Consistent with this hypothesis, we find a positive association between management earnings forecast errors and accruals. This positive association is stronger for firms operating in a more uncertain business environment and for firms in industries exhibiting greater covariation between accruals and growth-related activities. Moreover, this positive association is significant when accruals likely reflect managers' true beliefs about firms' business prospects, but is nonexistent when accruals are likely manipulated to boost managers' trading gains. Supplementary analysis reveals that the presence of management earnings forecasts does not significantly reduce accrual mispricing.

Download or read book Accounting for M A written by Amir Amel-Zadeh and published by Routledge. This book was released on 2020-04-29 with total page 331 pages. Available in PDF, EPUB and Kindle. Book excerpt: Spending on M&A has, in aggregate, grown so fast that it has even overtaken capital expenditure on increasing and maintaining physical assets. Yet McKinsey, the leading management consultancy, reports that "Anyone who has researched merger success rates knows that roughly 70% fail". The idea that businesses might be using huge and increasing sums of shareholders’ money for an activity that more often than not leads to failure calls into question the information on which M&A decisions are based. This book presents statistical studies, case material, and standard-setters’ opinions on company accounting before, during, and after M&A. It documents the manipulation of annual accounts by acquirers ahead of share for share bids, biased forecasts of post-merger earnings by bidders, and devices to flatter earnings when recording the deal. It explores the challenges for standard-setters in regulating information flows during and after M&A, and for account-users wishing to learn from financial statements how a deal has affected performance. Drawing on a wide range of international examples, this readable book is targeted not just at accounting specialists but at anyone who is comfortable reading the serious financial press, is intrigued by what is going on in the massive M&A market, and is concerned with achieving better-informed M&A. As such it might be of particular interest to business executives, lawyers, bankers, and investors involved in M&A as well as graduate students interested in researching or learning about the role of accounting in M&A.

Download or read book Advances in Quantitative Analysis of Finance and Accounting New Series 2011 Vol 9 written by Cheng F. Lee and published by Center for PBBEFR & Airiti Press. This book was released on 2011-10-01 with total page 339 pages. Available in PDF, EPUB and Kindle. Book excerpt: Advances in Quantitative Analysis of Finance and Accounting (New Series) is an annual publication designed to disseminate developments in the quantitative analysis of finance and accounting. The publication is a forum for statistical and quantitative analyses of issues in finance and accounting as well as applications of quantitative methods to problems in financial management, financial accounting, and business management. The objective is to promote interaction between academic research in finance and accounting and applied research in the financial community and the accounting profession.

Download or read book Earnings Management written by Joshua Ronen and published by Springer Science & Business Media. This book was released on 2008-08-06 with total page 587 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book is a study of earnings management, aimed at scholars and professionals in accounting, finance, economics, and law. The authors address research questions including: Why are earnings so important that firms feel compelled to manipulate them? What set of circumstances will induce earnings management? How will the interaction among management, boards of directors, investors, employees, suppliers, customers and regulators affect earnings management? How to design empirical research addressing earnings management? What are the limitations and strengths of current empirical models?

Download or read book Research Handbook on Accounting and Information Systems written by Julia A. Smith and published by Edward Elgar Publishing. This book was released on 2024-02-12 with total page 335 pages. Available in PDF, EPUB and Kindle. Book excerpt: The role of the accountant is changing, as developments in technology alter the ways in which information is prepared and analysed. This Research Handbook addresses the use of both financial and non-financial information for planning, decision-making and control in organisations. Written by experts in the field, the book uses comprehensive literature reviews, empirical fieldwork and theoretical developments to provide an overview of research in this important area.

Download or read book Evidence on the Tradeoff Between Real Manipulation and Accrual Manipulation to 25 Pages 26 to 50 Pages 51 to 75 Pages 76 to 100 Pages 101 to 120 written by Amy Yunzhi Zang and published by ProQuest. This book was released on 2000 with total page 120 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Whisper Forecasts and Earnings Management written by Arnoldo Jose Rodriguez and published by . This book was released on 2005 with total page 114 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Operations and Service Management Concepts Methodologies Tools and Applications written by Management Association, Information Resources and published by IGI Global. This book was released on 2017-11-30 with total page 1812 pages. Available in PDF, EPUB and Kindle. Book excerpt: Organizations of all types are consistently working on new initiatives, product lines, and workflows as a way to remain competitive in the modern business environment. No matter the type of project at hand, employing the best methods for effective execution and timely completion of the task is essential to business success. Operations and Service Management: Concepts, Methodologies, Tools, and Applications is a comprehensive reference source for the latest research on business operations and production processes. It examines the need for a customer focus and highlights a range of pertinent topics such as financial performance measures, human resource development, and business analytics, this multi-volume book is ideally designed for managers, professionals, students, researchers, and academics interested in operations and service management.

Download or read book Behaviour and Rationality in Corporate Governance written by Oliver Marnet and published by Routledge. This book was released on 2008-03-10 with total page 318 pages. Available in PDF, EPUB and Kindle. Book excerpt: Corporate scandals due to bad accounting happen too frequently for a system of corporate governance to be deemed effective. Exploring the reasons behind corporate misbehaviour, this book also answers the question of whether recent reforms are sufficient to prevent further scandals from occurring in the future.

Download or read book Earnings Quality written by Jennifer Francis and published by Now Publishers Inc. This book was released on 2008 with total page 97 pages. Available in PDF, EPUB and Kindle. Book excerpt: This review lays out a research perspective on earnings quality. We provide an overview of alternative definitions and measures of earnings quality and a discussion of research design choices encountered in earnings quality research. Throughout, we focus on a capital markets setting, as opposed, for example, to a contracting or stewardship setting. Our reason for this choice stems from the view that the capital market uses of accounting information are fundamental, in the sense of providing a basis for other uses, such as stewardship. Because resource allocations are ex ante decisions while contracting/stewardship assessments are ex post evaluations of outcomes, evidence on whether, how and to what degree earnings quality influences capital market resource allocation decisions is fundamental to understanding why and how accounting matters to investors and others, including those charged with stewardship responsibilities. Demonstrating a link between earnings quality and, for example, the costs of equity and debt capital implies a basic economic role in capital allocation decisions for accounting information; this role has only recently been documented in the accounting literature. We focus on how the precision of financial information in capturing one or more underlying valuation-relevant constructs affects the assessment and use of that information by capital market participants. We emphasize that the choice of constructs to be measured is typically contextual. Our main focus is on the precision of earnings, which we view as a summary indicator of the overall quality of financial reporting. Our intent in discussing research that evaluates the capital market effects of earnings quality is both to stimulate further research in this area and to encourage research on related topics, including, for example, the role of earnings quality in contracting and stewardship.

Download or read book Dissertation Abstracts International written by and published by . This book was released on 2007 with total page 652 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Index to Theses with Abstracts Accepted for Higher Degrees by the Universities of Great Britain and Ireland and the Council for National Academic Awards written by and published by . This book was released on 2007 with total page 362 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Economics of Accounting written by Peter Ove Christensen and published by Springer. This book was released on 2012-11-28 with total page 599 pages. Available in PDF, EPUB and Kindle. Book excerpt: This is the softcover version of a title that was released in 2002 and has sold more than 500 copies since then world wide. Examines the fundamentals of the decision-facilitating and decision-influencing role of information in accounting. Emphasises the impact of public and private information on equilibria and investor welfare in capital and product markets.

Download or read book The Use of Special Items to Inflate Core Earnings written by Sarah Elizabeth McVay and published by . This book was released on 2004 with total page 244 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Big Data and Machine Learning in Quantitative Investment written by Tony Guida and published by John Wiley & Sons. This book was released on 2019-03-25 with total page 308 pages. Available in PDF, EPUB and Kindle. Book excerpt: Get to know the ‘why’ and ‘how’ of machine learning and big data in quantitative investment Big Data and Machine Learning in Quantitative Investment is not just about demonstrating the maths or the coding. Instead, it’s a book by practitioners for practitioners, covering the questions of why and how of applying machine learning and big data to quantitative finance. The book is split into 13 chapters, each of which is written by a different author on a specific case. The chapters are ordered according to the level of complexity; beginning with the big picture and taxonomy, moving onto practical applications of machine learning and finally finishing with innovative approaches using deep learning. • Gain a solid reason to use machine learning • Frame your question using financial markets laws • Know your data • Understand how machine learning is becoming ever more sophisticated Machine learning and big data are not a magical solution, but appropriately applied, they are extremely effective tools for quantitative investment — and this book shows you how.