Discussion of “The Predictive Value of Expenses Excluded from Pro Forma Earnings”

Peter Easton ()
Additional contact information
Peter Easton: The Ohio State University

Review of Accounting Studies, 2003, vol. 8, issue 2, No 3, 175-183

Abstract: Abstract Doyle et al. (2003, this issue) provide evidence that IBES exclusions have incremental explanatory power (over GAAP earnings) for future cash flows, for market-adjusted returns at the earnings announcement date, and for future market-adjusted returns. They argue that this evidence supports the viewpoint that “the current regulatory concern about the use of pro forma earnings may be warranted.” My contention in this discussion is that one can readily posit alternative explanations for each of the empirical results, in turn suggesting that the results do not provide a basis for regulatory concern. Further, since there is considerable evidence that IBES earnings differ from pro forma earnings, it is not clear that the empirical analyzes in this paper may be used to draw any conclusions about pro forma earnings.

Keywords: Empirical Result; Empirical Analyze; Alternative Explanation; Cash Flow; Explanatory Power (search for similar items in EconPapers)
Date: 2003
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1023/A:1024457227197 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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:spr:reaccs:v:8:y:2003:i:2:d:10.1023_a:1024457227197

Ordering information: This journal article can be ordered from
http://www.springer.com/accounting/journal/11142

DOI: 10.1023/A:1024457227197

Access Statistics for this article

Review of Accounting Studies is currently edited by Paul Fischer

More articles in Review of Accounting Studies from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().