This article deals with the method of calculating lost profits, or determining the relevant basic formula, respectively. The aim is to summarise the knowledge about the used calculations, evaluate them and comment on the possibility of their use with regard to the purpose of the prepared...

Distinguishing between recurring and transitory components of earnings is a critical task in financial statement analysis. Academics and quantitative investors often rely on measures derived from standardized financial databases in making this distinction. We use unobserved components modelling...

We develop a novel technique to extract credit-relevant information from the text of quarterly earnings calls. This information is not spanned by fundamental or market variables and forecasts future credit spread changes. One reason for such forecastability is that our text-based measure...

The study examines the causal links between earnings quality and corporate social responsibility (CSR) performance using a large sample of United States (US) firms from 1992 to 2013. We first find that the association between earnings quality and CSR performance is positive and significant. We...

We introduce a real-time measure of conditional biases in firms' earnings forecasts. The measure is defined as the difference between analysts' expectations and a statistically optimal unbiased machine-learning benchmark. Analysts' conditional expectations are, on average, biased upwards, and...

We use the Korea Stock Exchange’s complete intraday order and trade data in a dataset that identifies individual accounts to examine whether trade-based pump-and-dump manipulators can trade profitably and whether other investors herd after the manipulation. The results show that other...

This paper investigates whether family ownership affects a firm’s cost behavior and profitability. We find that in response to changes in business activity level, family firms adjust their costs differently than non-family firms. That is, family firms decrease costs more sharply upon a sales...

Prior literature shows decision fatigue (the decline of decision quality after extensive decision-making) reduces analysts’ forecast accuracy. We study whether analysts strategically manage decision fatigue. Firms within an analyst’s research portfolio can differentially affect the...