Does analyst forecast informativeness affect managers’ financial reporting incentives?

Kimberly S. Krieg, Ferdinand Siagian and Juan Wu

Economics Letters, 2024, vol. 244, issue C

Abstract: This study investigates how the informativeness of analyst forecasts affects managers’ financial reporting incentives. Using a novel Match Index to estimate the earnings management induced by analyst forecasts, we find that when analyst forecasts are less informative, managers place less value on using them as a benchmark and thus, engage in less earnings management to meet that benchmark.

Keywords: Analyst forecasts; Informativeness; Earnings management; Abnormal return (search for similar items in EconPapers)
JEL-codes: G12 G17 M41 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:244:y:2024:i:c:s0165176524004798

DOI: 10.1016/j.econlet.2024.111995

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