We investigate the ability of a tax-based fundamental—the ratio of tax-to-book income— to predict earnings growth and stock returns and to explain the earnings-price ratio. This tax fundamental reflects both temporary and permanent book-tax differences as well as tax accruals, such as changes in the tax valuation allowance. We find that the tax-to-book income ratio predicts subsequent five-year...

We investigate the ability of a tax-based fundamental—the ratio of taxto-book income—to predict earnings growth and stock returns and to explain the earnings-price ratio. This tax fundamental reflects both temporary and permanent book-tax differences as well as tax accruals, such as changes in the tax valuation allowance. We find that the tax-to-book income ratio predicts subsequent five-year e...

Using Census data covering the 1980-2000 period, we examine what outcomes would be necessary for today’s recent immigrant cohorts to achieve earnings parity with Canadian-born workers. Our results show that today’s recent immigrants would have to experience a drastic steepening of their relative age-earnings profile in the near future for their earnings to converge with their Canadianborn count...

We find that on average an announcement of rising unemployment is “good news” for stocks during economic expansions and “bad news” during economic contractions. Thus stock prices usually increase on news of rising unemployment, since the economy is usually in an expansion phase. We provide an explanation for this phenomenon. Unemployment news bundles two primitive types of information relevant ...

This research aims to determine the impact of sustainability reports on Earnings Quality and Response Coefficient (ERC). The dependent variable was (ERC) independent used in this report. population were banking companies listed Indonesian Stock Exchange dan Shanghai for period 2020. sample 56 companies. analysis technique Partial Least Square (PLS). Data analyzed by SmartPLS program version 3. ...

While there are many alternative proxies for “earnings quality”, there is little evidence as to what auditors consider to be indicative of high earnings quality. To answer this, we examine the adjustments that auditors require companies to make to earnings during year-end audits. There are three findings. First, audit adjustments serve to increase earnings persistence, smoothness, and accrual q...

This study investigates the impact of IT investments and several contextual variables on the volatility of future earnings. We find evidence that IT investments strongly increases the volatility of future earnings and that four contextual factorsindustry concentration, sales growth, diversification, and leveragestrongly moderate IT’s effect on earnings volatility. It is notable that while the m...