Baruch for helpful comments on earlier drafts. A previous version of this paper was titled " Loss reversals and earnings-based valuation. " All errors are our own. Abstract We hypothesize that when confronted with a loss, investors price earnings conditional on the likelihood of the firm's return to profitability. We argue such pricing is consistent with the abandonment option hypothesis as des...

this paper takes fundamental analysis research beyond the spatial and temporal bounds of previous studies. it was investigated that how detailed financial statement data enter the decisions of market makers by examining how current changes in the fundamental signals chosen can provide information on subsequent earnings changes. using tehran stock exchange’s firms data from 2003 to 2012, the rol...

Using data from the National Longitudinal Survey of Youth, this study partitions competing sources of earnings variation into four components: a component for individual-level factors, a component for transitory factors, a component for occupational factors, and a component for geographic factors. From these variance components intraclass correlation coefficients are calculated and compared wit...

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...

Available online 13 November 2014 This study examines the relationship between family firms and earnings management by considering the influence of board independence. Based on a sample of 379 listed high-technology firms over 7 years in Taiwan, we find that family firms are positively related to earnings management. Further, we find two interaction effects: (1) the proportion of independent di...

Stock-based compensation puts managers in the position of having, at some point, to sell stock. The prevalence of stock-based compensation in the 1990s allegedly created incentives for managers to hype their companies’ stock price by manipulating earnings before selling stock. Consistent with this conjecture, we find that managers tended to inflate earnings prior to selling stock. Moreover, the...

This paper examines whether managers signal firms’ future performance by managing earnings to exceed thresholds. Because managers’ reporting discretion is bounded by the accounting regulations, managing earnings to exceed current period’s thresholds reduces future earnings and therefore makes future earnings thresholds harder to reach. As a result, only firms with sufficient future earnings gro...

The Iranian economy in recent years is due to the development of economic sanctions, a sharp decline in the price of oil and the deficit resulting from revenue - dependent on oil revenues and the trend towards tax revenues. While comparing the volume of the Iranian economy with the amount of tax income indicates the existence of a relatively significant tax gap. The tax gap is the difference be...