Types of politically connected firms and analysts' earnings forecast

Purpose This study examined the effect of different types politically connected (PCON) Malaysian firms on analysts' forecast accuracy and dispersion. Design/methodology/approach The identified PCON according to Wong Hooy's (2018) classification, which divided political connections into government-linked companies (GLCs), boards directors, business owners family members government leaders. sample covered period 2007–2016, for earnings data were obtained from Institutional Brokers' Estimate System (IBES) database financial extracted Thomson Reuters Fundamentals. We deleted any market consensus estimates made by less than three analysts and/or with years analyst information control impact individual personal attributes. Findings found that associated lower higher was more salient in GLCs other firms, either through families, ties or directors. Further analyses showed firms—in particular GLCs—were aggressive reporting poorer quality accruals, hence providing inadequate produce accurate dispersed forecasts. results robust even after addressing endogeneity issues. Research limitations/implications new evidence exacerbating asymmetry, not addressed prior studies. Practical implications has a significant practical implication investors they should be mindful high asymmetry particularly companies. Originality/value is first provide