Prior studies argue that stable shareholders do not encourage firm managers to manage their earnings to achieve short-term earnings goals. They also state that firm managers with stable shareholders have an incentive to report smooth earnings to maintain long-term relationships with such...

We investigate managerial discretion over initial management earnings forecasts issued concurrently with earnings announcements. Japan's unique reporting environment, particularly its systematic bundled management forecasts, produces an earnings benchmark (i.e., forecast innovations) to which...