Capital Market Implications of Earnings Quality (Paperback) (ISBN-13: 9783899369212)

In his speech from 1998 the former chairman of the United States Securities and Exchange Commission (SEC) Arthur Levitt pointed out that trust "is the bedrock of our capital markets" and that this must not be shaken by the erosion of earnings quality. He made clear that it is the challenge of the whole financial community to counteract such a development. This thesis deals with the question whether the importance of earnings for the capital market varies with its quality. The question arises, because in recent years a large number of firm scandals has shaken the trust in the reliability of reported earnings. In order to properly address the research questions, the literature on earnings quality definitions, quality measures as well as implications of earnings quality on capital markets is reviewed and critically discussed. The author investigates whether well known results concerning capital market implications of earnings quality remain stable for all measures considered. She answers the question of how earnings quality affects firm value, cost of equity capital, and the accuracy of analysts' forecasts taking into account the effects of determinants of earnings quality.

Author: Bianca Ahrens
ISBN-10: 3899369211
ISBN-13: 9783899369212
Publisher: Josef Eul Verlag Gmbh
Language: English
Published: 05/01/2010
Pages: 280
Format: Paperback
Weight: 0.74lbs
Size: 8.27h x 5.83w x 0.59d