Digital transformation and management earnings forecast

Qin Liu, Fen Yuan, Fang Wu and Siming Yu

International Review of Economics & Finance, 2024, vol. 96, issue PA

Abstract: This paper conducts an empirical examination using listed companies on China's Shanghai and Shenzhen A-share markets from 2010 to 2020. The findings indicate that digital transformation has a significant positive effect on the quality of management's earnings forecast. Mechanism analysis reveals that this effect is more pronounced in companies with lower internal control indices, higher levels of corporate governance, and higher agency costs. Digital transformation enhances the quality of corporate information disclosure and mitigates information asymmetry, further improving management's earnings forecast level. Through heterogeneity analysis, further research finds that companies lacking a technical background among senior executives, those in less competitive industries, those with poor growth, and non-state-owned enterprises, experience a more significant positive impact on the quality of management earnings forecasts from digital transformation. The conclusions provide new evidence for continuing to advance digital transformation and elucidate the benign cycle mechanism between the capital market and the national economy. This study also proposes new perspectives for the regulation of predictive information disclosure by enterprises.

Keywords: Digital transformation; Management earnings forecast; Internal control; Information disclosure (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1059056024005628
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:96:y:2024:i:pa:s1059056024005628

DOI: 10.1016/j.iref.2024.103570

Access Statistics for this article

International Review of Economics & Finance is currently edited by H. Beladi and C. Chen

More articles in International Review of Economics & Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().