Kothari et al. (2005) propose ROA-matched models to estimate discretionary accruals for samples skewed toward firms with good or poor performance to reduce the frequency of Type I errors. Many researchers, however, use such models for unskewed samples. In these cases, ROA-matched models have no...

This study shows that firms collectively incur a cost for managing earnings and analyst expectations to meet earnings forecasts. We compare the coefficient in the regression of abnormal stock returns on earnings surprise (the earnings response coefficient (ERC)) across ranges of earnings...

Kothari et al. (2005) propose ROA matched models to estimate discretionary accruals for samples skewed toward firms with good or poor performance to reduce the frequency of Type I errors. Many researchers, however, use such models for unskewed samples. In these cases, ROA matched models have no...

Plant managers generally have no direct marketing responsibilities, but they have control over product quality and customer service. I hypothesize that many firms evaluate these managers on profit since sales, a component of profit, convey information on plant manager’s performance on product...