Bundled Forecasts in Empirical Accounting Research
69 Pages Posted: 17 May 2006 Last revised: 20 Jun 2012
Date Written: June 13, 2011
Abstract
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.
Keywords: Management Forecasts, conference calls, Regulation FD, earnings announcements
JEL Classification: M41, M45, D82, G14
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
The Role of Supplementary Statements with Management Earnings Forecasts
By Amy P. Hutton, Gregory S. Miller, ...
-
Do Managers Withhold Bad News?
By S.p. Kothari, Susan Shu, ...
-
By Marilyn F. Johnson, Ron Kasznik, ...
-
Does Disclosure Deter or Trigger Litigation?
By Laura Casares Field, Michelle Lowry, ...
-
Shareholder Wealth Effects of the Private Securities Litigation Reform Act of 1995
By Marilyn F. Johnson, Ron Kasznik, ...
-
Do Conference Calls Affect Analysts' Forecasts?
By Robert M. Bowen, Angela K. Davis, ...
-
The Financial Reporting Environment: Review of the Recent Literature
By Anne Beyer, Daniel A. Cohen, ...
-
Management Earnings Forecasts: A Review and Framework
By D. Eric Hirst, Lisa Koonce, ...