Abstract

http://ssrn.com/abstract=1088818
 
 

References (47)



 


 



An Analysis of the Reasons for the Asymmetries Surrounding Earnings Benchmarks


Bruce Bennett Bruce Bennett


affiliation not provided to SSRN

Michael E. Bradbury


Massey University



Abstract:     
Please enter abstract text here.Several studies report an asymmetry in the distribution of earnings around specified benchmarks (Hayn 1995; Burgstahler and Dichev 1997; Degeorge et al. 1999; Brown and Caylor 2005). Doubt has arisen over whether the observed kink in the distribution of earnings is solely caused by earnings management (Dechow et al. 2003; Coulton et al. 2005; Beaver et al. 2006 and Durtschi and Easton 2005). We use a ratio analysis approach to examine a range of specific accruals for earnings management. We find little evidence that firms immediately above the benchmark have abnormal receivables, inventories or provisions. However, they do increase cash-from-customers and reduce inventory. Thus our results support the recent research that suggests firms engage in real actions to meet earnings benchmarks (Ewert and Wagonhofer 2006; Graham et al. 2005, Roychowdhury 2006).

Number of Pages in PDF File: 48

Keywords: Earnings benchmarks, earnings management, ratio analysis, direct cash flows

JEL Classification: C89, G10, M41

working papers series





Download This Paper

Date posted: February 6, 2008  

Suggested Citation

Bruce Bennett, Bruce Bennett and Bradbury, Michael E., An Analysis of the Reasons for the Asymmetries Surrounding Earnings Benchmarks. Available at SSRN: http://ssrn.com/abstract=1088818 or http://dx.doi.org/10.2139/ssrn.1088818

Contact Information

Bruce Bennett
affiliation not provided to SSRN
Michael E. Bradbury (Contact Author)
Massey University ( email )
School of Accountancy
Private Bag 102 904
Auckland
New Zealand
64 9 414 0800 (Phone)
64 9 441 8133 (Fax)
Feedback to SSRN


Paper statistics
Abstract Views: 598
Downloads: 117
Download Rank: 144,332
References:  47

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo4 in 0.281 seconds