Research note: how the financial styles of managers impact financial and valuation metrics

E. Ted Prince

Review of Accounting and Finance, 2008, vol. 7, issue 2, 193-205

Abstract: Purpose - The purpose of this paper is to reveal a new contribution to behavioural finance that focuses on individuals rather than groups. Design/methodology/approach - Research is based on field studies with executives utilizing an assessment instrument to identify and measure their financial traits. The approach to the topic is to present the underlying model of financial traits and show how they add another dimension to behavioural finance approaches. Findings - The model identifies three financial styles, each of which comprises three financial signatures. Each of the financial signatures leads to characteristic financial decisions with specific valuation outcomes. Research limitations/implications - The research is in its early stages. It requires larger sample sizes and needs to be conducted across industries and different cultures. Its implications are that can be predicted the financial performance and valuation of companies by knowing the financial styles of their leaders and managers, and also their financial cultures. Practical implications - Practical implications are that this work can be used as a new method for valuing companies, for stock analysis and for portfolio analysis and valuation. It can also be used as a basis for M&A, to assess the financial alignment of companies conducting M&A and the likely chances of success. Originality/value - The paper shows a totally new way to assess the valuation outcomes of individuals, teams and companies based purely on their behavioural financial traits.

Keywords: Behavioural accountancy; Financial reporting; Managers; Financial performance (search for similar items in EconPapers)
Date: 2008
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

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:eme:rafpps:v:7:y:2008:i:2:p:193-205

DOI: 10.1108/14757700810874155

Access Statistics for this article

Review of Accounting and Finance is currently edited by Nawazish Mirza

More articles in Review of Accounting and Finance from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().