 The distribution of earnings relative to targets in the European UnionHolger Daske, Günther Gebhardt and Stuart McLeay Accounting and Business Research, 2006, vol. 36, issue 3, 137-167 Abstract: This paper provides evidence on the distribution of reported earnings relative to targets in the Member States of the European Union (EU). For a large sample of over 60,000 firm-years between 1986 and 2001, we find that more firms than expected (i) report small positive earnings, (ii) report small positive earnings changes and (iii) have zero or small positive forecast errors. These discontinuities are much more pronounced in the EU compared to the US, and the distributions of reported earnings and earnings changes are characterised by lower dispersion and more clustering around zero, consistent with higher income smoothing in Europe. Across the EU, we find that the avoidance of a loss or an earnings decrease is more common in those Member States which do not have a long history of accounting standard setting, and particularly in those which, until recently, were almost entirely law-based. The earnings distributions and earnings change distributions of UK firms resemble more those of their counterparts in the US. and differ from the rest of the EU. despite the various EU harmonisation efforts that have taken place. Date: 2006 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:acctbr:v:36:y:2006:i:3:p:137-167 Ordering information: This journal article can be ordered from DOI: 10.1080/00014788.2006.9730019 Access Statistics for this article Accounting and Business Research is currently edited by Vivien Beattie More articles in Accounting and Business Research from Taylor & Francis Journals |
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