Options trades, short sales and real earnings management
نویسندگان
چکیده
منابع مشابه
Who Trades on Pro Forma Earnings Information?
In recent years, many companies have emphasized adjusted-GAAP earnings numbers in their quarterly press releases. While managers use different names to describe these nonstandard earnings metrics, the financial press frequently refers to them as ‘‘pro forma’’ earnings. Managers and other advocates of pro forma reporting argue that these disclosures provide a clearer picture of companies’ core e...
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Earnings prediction is one of the most important communication channels for transferring information to investors. Despite the importance of earnings prediction, few studies examined whether real earnings management are effective in predicting them. In this paper, the effect of earnings forecasting on firm risk is reviewed by considering real earnings management. Since earnings prediction char...
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We examine the relation between firms’ real earnings management decisions and the slack in their net worth debt covenant. Using private debt covenant data, we find that the overall level of real earnings management is higher when net worth covenant slack is tighter. Moreover, we find that this effect is more pronounced for loan-years with the tightest slack, which is a setting where benefits of...
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Due to the fact that assets are recorded at their historical value and they may include unrealized gains (losses), managers may manipulate earnings through the sale of these assets and provide financial information which is not accurate and reliable. The aim of this study is to investigate the relationship between income from asset sales, earnings change and leverage of companies listed on Tehr...
متن کاملMergers and market valuation: real options approach
This paper investigates the connection between market valuation anda type of the merger (stock, cash) using real options setup. I solveexplicitly for the timing and terms of cash mergers in two deferent settingsto demonstrate that cash mergers generally occur at low marketvaluations, whereas stock mergers that may be observed at both low andhigh valuations; the result holds with some dierences ...
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ژورنال
عنوان ژورنال: Accounting and Business Research
سال: 2019
ISSN: 0001-4788,2159-4260
DOI: 10.1080/00014788.2019.1573655