search query: @author Matsunaga, S. / total: 4
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| Author: | Hui, K.W. Matsunaga, S. Morse, D. |
| Title: | The impact of conservatism on management earnings forecast |
| Journal: | Journal of Accounting & Economics
2009 : JUN, VOL. 47:3, p. 192-207 |
| Index terms: | management forecasting reporting regression analysis accounting principles |
| Language: | eng |
| Abstract: | This paper examines the empirical relation between a firm's accounting conservatism and management's issuance of quantitative earnings forecast. Three measures of conservatism from prior literature are used along with two aggregate measures. A negative association between conservatism and the frequency, specificity, and timeliness of management forecasts is found. These results are robust to estimating the regression in changes, using firm fixed-effects, and using a two-stage instrumental variables approach. Overall, the results suggest accounting conservatism acting as a substitute for management forecasts by decreasing information asymmetry in the market and reducing potential litigation through the timely reporting of bad news. |
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