Download or read book Additional Evidence on the Incremental Information Content of Cash Flows and Accruals written by Ray J. Pfeiffer and published by . This book was released on 1999 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This study evaluates the relation between security returns and funds-based earnings components. We document that proxies for market expectations of the components that are based on measures of historical serial- and cross-dependencies are substantially more accurate than random-walk proxies. Moreover, we detect significantly higher valuations of the operating cash flow component of earnings, relative to current accruals when market expectations are represented using the dependency-based predictions. Such differential valuation is not detectable for random-walk representations. Contrary to results in Ali (1994), we find incremental information in unexpected cash flows over the whole spectrum (moderate and extreme) of unexpected cash flow realizations.
Download or read book The Incremental Information Content of Accruals and Cash Flows After Controlling for Earnings written by Gordon Peter Wilson and published by . This book was released on 1986 with total page 114 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Incremental Information Content of Accrual Versus Cash Flow written by Dyna Seng and published by . This book was released on 1996 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Incremental Information Content of Cash Flows and the Ability of Accrual Versus Cash Flows to Predict Future Cash Flows written by Dyna Seng and published by . This book was released on 1995 with total page 162 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Incremental Information Content of Accrual Versus Cash Flows in New Zealand written by Alister Lyall Hunt and published by . This book was released on 1990 with total page 130 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Informativeness and Predictability of Earnings and Cash Flows written by Zhemin Wang and published by . This book was released on 1991 with total page 236 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The usefulness of accounting measures in predicting future cash flow written by Nikolay Draganov and published by GRIN Verlag. This book was released on 2021-08-10 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt: Master's Thesis from the year 2021 in the subject Business economics - Accounting and Taxes, grade: 1,0, University of Cologne, language: English, abstract: The primary aim of this study is to empirically examine the relative ability of accounting earnings and cash flow to predict future cash flow. Moreover, the role of accruals in cash flow predictions is called into question. One of the major purposes of financial reporting consists in ensuring an informational basis that helps investors, creditors and other users of accounting data to overcome the uncertainty associated with the future cash flows of enterprises their financial activity relates to. At the same time, the accrual concept prevails in modern accounting, since it is theorized to mitigate the mismatching and timing problems of the unrefined cash ba-sis accounting. Hence, recognizing revenues and expenses in the period when they have occurred, and not when cash was received or paid out, should create a more relevant framework for decision making. The use of accrual accounting earnings as a summary measure of financial performance instead of the more primitive cash flows is therefore advocated by accounting standard setters. For instance, the Financial Accounting Stand-ard Board claims that: “Information about enterprise earnings and its components measured by accrual accounting generally provides a better indica-tion of enterprise performance than information about current cash receipts and pay-ments”. The FASB’s statement led to a rising discussion in the financial research on whether accounting earnings provide a more reliable picture of a company’s future operating cash flows than current operating cash flows themselves do. Hence, a major implication of the above quotation refers to the incremental power of accruals and its components in predicting future cash flows beyond the one contained into current operating cash flows. This debate represents a cornerstone in evaluating the information quality offered by the accrual accounting concept.
Download or read book Incremental Information Content of Cash Flows written by Cynthia Wilson and published by . This book was released on 1993 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Usefulness of Direct and Indirect Cash Flow Disclosures written by Greg Clinch and published by . This book was released on 2010 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt: We investigate the ability of disclosed operating cash flow and indirect accruals components to explain annual returns for a sample of Australian firms. Consistent with claims made by accounting standard setters, we find evidence of significant explanatory power for disclosed operating cash flow components beyond aggregate operating cash flows when they also have significant incremental predictive power for future (one year ahead) operating cash flows. Accrual components also have incremental explanatory power for returns. In addition, we find evidence of significant explanatory power for operating cash flow components beyond estimates of the components (based on other financial statement disclosures) for firms with large differences between disclosed and estimated components.
Download or read book the nature and amount of information reflected in cash flows and accruals written by victor l. bernard and thomas l. stober and published by . This book was released on 1989 with total page 56 pages. Available in PDF, EPUB and Kindle. Book excerpt:
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 Incremental Information Content of Cash Flow Variables written by Moon Kyum Kim and published by . This book was released on 1991 with total page 242 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study investigates whether alternative cash flow measures have an incremental information content over accounting measure. This study employes the arbitrage argument to establish an economic model which makes it possible to incorporate raw accounting variables into a return generating process. Based on the economic model, a new methodology, the spanning portfolio approach is used to extract the information contained in the accounting measures of cash flow. This issue is first examined by testing for an association between actual security returns and spanning returns of alternative cash flow measures. Secondly, the issue is analyzed in the context of explaining market risk. The results indicate that both cash flow and accrual accounting earnings have incremental information content relative to each other in explaining the actual security returns. Also, the results reveal that, in explaining market risk, only cash flow has information consistent with that contained in market risk measure (market beta) and provides significant incremental information over that provided by earnings. These findings imply that the accrual adjustment process in accounting may not be valuable at least for assessing the company's systematic risk.
Download or read book A Further Examination of the Incremental Information Content of Cash flow Announcements written by John Douglas Hanna and published by Ann Arbor, Mich. : University Microfilms International. This book was released on 1991 with total page 268 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Incremental Information Content of Cash Flow from Operations an Exploratory Study of Intertemporal and Firm specific Effects written by Michael Ofosu Mensah and published by . This book was released on 1990 with total page 108 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Accrual Accounting Cash Accounting and the Estimation of Future Cash Flows written by Aliasghar Mottaghi and published by . This book was released on 2011 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This study investigates the predictive ability of current and past cash flows with respect to the estimation of future cash flow, and compares this predictive ability with that of current and past earnings. Future cash flow is estimated in this study on the basis of a model hierarchy that initially incorporates aggregated predictors and then their disaggregated components, with the objective of improving on conventional research design with respect to the problematic issues surrounding missing values in source databases, extreme values in the sampled data and variability in fiscal year length. In determining whether the disaggregation of earnings into cash flow, accruals and their components adds to the predictive ability of cash flow, the present thesis also documents out-of-sample accuracy tests for the UK based on initial in-sample estimations, with accruals being computed using both the information in the Statement of Cash Flows and the information that may be derived from Balance Sheet changes. Using the information in the Statement of Cash Flows, the results of the in-sample estimation indicate that, whilst there is no notable difference between the ability of cash flow and aggregate earnings to predict future cash flow, the disaggregation of earnings into cash flow and accruals improves the prediction. The out-of-sample accuracy tests confirm the standard result that this disaggregated earnings model is a better predictor of future cash flow. In contrast, this thesis shows that, when using information in the Balance Sheet, by way of changes from one period to the next, the results of both the in-sample estimation and the out-of-sample accuracy tests show that disaggregated earnings is unable to outperform aggregate earnings in predicting future cash flow. Nevertheless, when the total accrual is further disaggregated into its deferral and accrual components, in-sample estimation reveals additional improvement in predictive ability, using each of the two sources of information to compute total accruals (the Statement of Cash Flows and Balance Sheet changes), although this is less evident with the out-of-sample tests. Whilst further analysis indicates that disaggregation is more informative when the firm size is large, the magnitude of accruals is low and the firm reports a positive CFO and EBIT, the thesis shows that the ability of the estimation models to predict future cash flow differs across industries in the UK, and that the findings are generally sensitive to the effect of database choice, the fiscal year length, and the identification and treatment of unrecorded data.
Download or read book The Information Content of Cash Flows Versus Accrual based Income Numbers written by John Carolin and published by . This book was released on 2006 with total page 326 pages. Available in PDF, EPUB and Kindle. Book excerpt:
