Arnedo, Laura; Lizarraga, Fermín; Sánchez, Santiago - In: SERIEs - Journal of the Spanish Economic Association 3 (2012) 4, pp. 499-520
cash flows for the prediction of future cash flows. Using a sample of 4,397 Spanish companies (mostly privately held), we … that the out-of-sample prediction errors provided by the accrual-based earnings model are significantly lower than those … obtained with the cash flows model. We also regress the decrease in prediction errors brought about by the addition of accruals …