Bundled Forecasts in Empirical Accounting Research
Jonathan L. Rogers
University of Chicago - Booth School of Business
Andrew Van Buskirk
Ohio State University (OSU) - Department of Accounting & Management Information Systems
June 13, 2011
Journal of Accounting & Economics (JAE), Forthcoming
Chicago Booth Research Paper No. 09-37
This paper examines “bundled” forecasts, or management earnings forecasts issued concurrently with earnings announcements, which have evolved to become the most common type of management forecast. We describe the econometric problems associated with measuring bundled forecast news and, in particular, provide evidence that the measurement error in the traditional calculation of forecast news is material and is systematically associated with variables frequently studied in forecast-related research. We illustrate an application of conditional expectations to overcome these problems. Finally, we offer guidance and caveats to researchers considering the use of this method in the future.
Number of Pages in PDF File: 69
Keywords: Management Forecasts, conference calls, Regulation FD, earnings announcements
JEL Classification: M41, M45, D82, G14Accepted Paper Series
Date posted: May 17, 2006 ; Last revised: June 20, 2012
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