This article documents the long-horizon mean reverting character of annual earnings and tests the implications of such mean reversion for security valuation. First, both theory-based and nonparametric measures of earnings persistence decrease as the estimation order increases, revealing 40...

We review and simultaneously introduce a convenient statistical concept for the mathematical representation of the Statistical Activity Cost Theory (SACT) introduced by Willett (1987 and 1988). Further, we discuss, and present a critique of, a variety of statistical models with respect to long...

Purpose – The purpose of this paper is to explore whether internal audit's reporting relationship with the audit committee and the client's business risk environment impact external auditors' reliance on the work of internal audit. Design/methodology/approach – An experiment is conducted...

This is a study of earnings quality, examining whether components of earnings based on New Zealand (N.Z.) accounting classification systems have different information parameters. The N.Z. environment provides a unique opportunity to examine a period with no legislative backing of accounting...

In this study, pooled time-series, cross-sectional data on 110 Australian companies over the period 1992-1998 is employed to examine whether EVA® is more highly associated with stock returns than conventional accounting-based measures: namely, earnings before extraordinary items, net cash flow...

This statistical note examines trends in Australian accounting enrolments and student load, together with the composition of enrolments and course completions, over the 1990s. Unpublished higher education statistics from the Department of Employment, Training and Youth Affairs (DETYA) is...

The aim of this paper is to explain Australian R&D capitalisation and voluntary disclosure. It is argued that the discretionary choices available to management in Australia with respect to the accounting for and the disclosure of R&D expenditure and activities can be explained by the reduction...

The profile of accounting in the nonprofit sector has been raised substantially in recent years, due to profound changes in the institutional environment in which organizations in that sector operate. One of the factors that has resulted in the adoption of corporate-style financial management...

The Public Sector Accounting Standards Board (PSASB) has developed accounting standards for the public sector in Australia. A procedural 'due process' has been developed to protect the openness, neutrality and independence of Australian accounting standard-setting both in the private and public...

A view presented consistently in the management accounting literature is that firms usually operate at full capacity. Because firms are therefore subjected to physical capacity constraints, they frequently have to choose which of their profitable products to produce and in what quantities. The...