 Business strategy, earnings properties, and earnings qualityNikolaos Karampinis, Orestes Vlismas and Apostolos Ballas Journal of International Accounting, Auditing and Taxation, 2024, vol. 56, issue C Abstract: This study explores the relationship between business strategy and earnings properties, which are frequently considered as proxies of earnings quality. Specifically, we examine the implications of different strategic positionings for earnings properties that are related to earnings management, conditional conservatism, earnings persistence, and earnings smoothness. Using an international sample, our empirical results indicate that business strategy is inherently linked to these earnings properties. Firms that focus on a business strategy of continuous innovation have larger discretionary accruals, more persistent earnings, and lower earnings smoothness relative to firms that focus on a business strategy of operation efficiency. We also find some evidence for differences in conditional conservatism, although the associations are weaker and sensitive to sample composition. Our main inference is that business strategy inherently affects earnings properties. Keywords: Business Strategy; Earnings Management; Conditional Conservatism; Earnings Persistence; Earnings Smoothness; Earnings Quality (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jiaata:v:56:y:2024:i:c:s1061951824000387 DOI: 10.1016/j.intaccaudtax.2024.100632 Access Statistics for this article Journal of International Accounting, Auditing and Taxation is currently edited by R. Larson More articles in Journal of International Accounting, Auditing and Taxation from Elsevier |
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