NDLI: Rewriting earnings history

Content Provider	Springer Nature Link
Author	Lev, Baruch Ryan, Stephen G. Wu, Min
Copyright Year	2007
Abstract	Research on the usefulness of financial information generally focuses on the innovation in the information examined, such as an earnings surprise or cash flow growth. Consequently, prior research sheds little light on the role of the rich historical record of financial information in users’ decision-making. Using a sample of published restatements of earnings, we show that the revision of the historical pattern of earnings, distinct from the magnitude of the restatement and its impact on current earnings, significantly affects investors’ decisions and predicts class action lawsuits. Specifically, we find that restatements that eliminate or shorten histories of earnings growth or positive earnings have significantly more adverse effects for investor valuations and the likelihood of lawsuits than other restatements. This evidence about the value-relevance of refreshing the historical record of earnings is pertinent to the FASB’s recent cautious expansion of the scope of circumstances that require a restatement of financial information in FAS 154.
Starting Page	419
Ending Page	451
Page Count	33
File Format	PDF
ISSN	13806653
Journal	Review of Accounting Studies
Volume Number	13
Issue Number	4
e-ISSN	15737136
Language	English
Publisher	Springer US
Publisher Date	2007-06-01
Publisher Place	Boston
Access Restriction	One Nation One Subscription (ONOS)
Subject Keyword	Historical record Revisions Financial information Investors’ decisions Class action lawsuits Public Finance & Economics Finance /Banking Accounting/Auditing
Content Type	Text
Resource Type	Article
Subject	Accounting

Sl.	Authority	Responsibilities	Communication Details
1	Ministry of Education (GoI), Department of Higher Education	Sanctioning Authority	https://www.education.gov.in/ict-initiatives
2	Indian Institute of Technology Kharagpur	Host Institute of the Project: The host institute of the project is responsible for providing infrastructure support and hosting the project	https://www.iitkgp.ac.in
3	National Digital Library of India Office, Indian Institute of Technology Kharagpur	The administrative and infrastructural headquarters of the project	Dr. B. Sutradhar bsutra@ndl.gov.in
4	Project PI / Joint PI	Principal Investigator and Joint Principal Investigators of the project	Dr. B. Sutradhar bsutra@ndl.gov.in Prof. Saswat Chakrabarti will be added soon
5	Website/Portal (Helpdesk)	Queries regarding NDLI and its services	support@ndl.gov.in
6	Contents and Copyright Issues	Queries related to content curation and copyright issues	content@ndl.gov.in
7	National Digital Library of India Club (NDLI Club)	Queries related to NDLI Club formation, support, user awareness program, seminar/symposium, collaboration, social media, promotion, and outreach	clubsupport@ndl.gov.in
8	Digital Preservation Centre (DPC)	Assistance with digitizing and archiving copyright-free printed books	dpc@ndl.gov.in
9	IDR Setup or Support	Queries related to establishment and support of Institutional Digital Repository (IDR) and IDR workshops	idr@ndl.gov.in

Analyst information production and the timing of annual earnings forecasts

Disclosure of GAAP line items in earnings announcements

The Effect of Accounting Restatements on Earnings Revisions and the Estimated Cost of Capital

Biased voluntary disclosure

Discussion of “The Effect of Accounting Restatements on Earnings Revisions and the Estimated Cost of Capital”

Does earnings acceleration convey information?

Stock Price Reaction to Evidence of Earnings Management: Implications for Supplementary Financial Disclosure

The role of accounting disaggregation in detecting and mitigating earnings management

Discussion of “Signaling firm value to active investors”

Rewriting earnings history

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