Management earnings forecasts and other forward-looking statements

Zahn Bozanic, Darren T. Roulstone and Andrew Van Buskirk

Journal of Accounting and Economics, 2018, vol. 65, issue 1, 1-20

Abstract: We identify forward-looking statements (FLS) in firms’ disclosures to distinguish between “forecast-like” (quantitative statements about earnings) and “other”, or non-forecast-like, FLS. We show that, like earnings forecasts, other FLS generate significant investor and analyst responses. Unlike earnings forecasts, other FLS are issued more frequently when uncertainty is higher. We then show that earnings-related FLS are more sensitive to uncertainty than quantitative statements, suggesting that managers are more likely to alter the content than the form of FLS when uncertainty is higher. Our study indicates that incorporating other FLS into empirical measures provides a more comprehensive proxy for firms’ voluntary disclosures.

Keywords: Management forecasts; Earnings announcements; Textual analysis; Voluntary disclosure (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (34)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jaecon:v:65:y:2018:i:1:p:1-20

DOI: 10.1016/j.jacceco.2017.11.008

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