Governments have always affected the economic environment as a policy maker. On the other hand, the presence of political connection as representatives of governments in companies affects their administrative and decision - making methods.Firms and managers manage them under environmental conditions by applying different approaches to earning management in order to achieve their goals.The gover...

We examine how adjustments to earnings during year-end audits affect measures of earnings quality. There are four key findings. First, audit adjustments cause earnings to become smoother and more persistent. Second, the adjustments result in higher accrual quality. Third, audit adjustments have a larger negative effect on signed accruals than absolute accruals. Fourth, the adjustments do not re...

We collect a unique dataset of Twitter posts to examine the change in investor disagreement around earnings announcements. We find that investors’ opinions can either converge (reduced disagreement) or diverge (increased disagreement) around earnings announcements. While the convergence of opinion is associated with lower earnings announcement returns, the divergence of opinion is associated wi...

We rely on the theoretical prediction that financial misreporting peaks before economic busts to examine whether aggregate ex ante measures of likelihood improve predictability U.S. recessions. consider six and show Beneish M-Score significantly improves out-of-sample recession at longer forecasting horizons. Specifically, relative leading models based yield spreads market returns, increases av...

A variety of alternative definitions and sources of actual earnings realizations are available to investors. In addition to “traditional” earnings numbers produced in conformity with generally accepted accounting principles (GAAP) and filed with the Securities and Exchange Commission (SEC), these alternative measures include the so-called Street earnings numbers that are based on proprietary de...

We examine the increasing variance of earnings of white men over the 1970s and 1980s by focusing on changes in the covariance structure of earnings. Using data from the Michigan PSID from 1969-1987, we find that about half of the increase has arisen from an increase in the variance of the permanent component of earnings and half from an increase in the variance of the transitory component, wher...

This paper studies market and analyst reactions to earnings (i) during a proxy contest for board seats and (ii) after a proxy-contest-induced management change. Despite indications of earnings management during the proxy contest, market and analyst reactions are more pronounced than in prior periods, and earnings surprises explain more of the cross-sectional variation in these reactions. Market...

In this paper I analyse the dynamic structure of earnings in Great Britain for the period 1991-1999 by decomposing the earnings covariance structure into its permanent and transitory components. Using information on monthly earnings of male full-time employees from the first nine waves of the British Household Panel Study I find that earnings inequality increases over the Nineties. However, ear...

We argue that earlier quantitative research on the relationship between heterosexual partners’ earnings and time spent on housework has two basic flaws. First, it has focused on the effects of women’s shares of couples’ total earnings on their housework, and has not considered the simpler possibility of an association between women’s absolute earnings and housework. Consequently it has relied o...

If self-employment were much more prevalent at moderate and high earnings levels than at low levels and if the incidence of both the employee and employer taxes on wages is on the employee, then the social security tax structure would be regressive relative to taxable earnings. Analysis shows, however, that this is the case only in a very limited sense. For 1970, 6.5 percent of taxable earnings...