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...

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...