This paper seeks to advance the practical application of theoretically grounded accounting based equity valuation models which use the concept of earnings persistence. It does so by employing an empirically tractable development of the clean surplus residual income based valuation models that...

Advocates of dirty surplus accounting practices argue that such practices produce more useful reported earnings numbers because value irrelevant flows are eliminated from reported earnings. Opponents of such practices suggest that dirty surplus accounting can result in the exclusion of value...

This paper provides a rationale for the view that there is no inconsistency between the expectation that a corporation will earn normal economic returns and the expectation that the corporation will generate a persistently growing stream of positive net present value opportunities, persistent...

Motivated by the fact that residual income based models of the link between the value of equity capital and the outputs of accrual accounting recently appearing in the literature have been based on particular assumed classes of residual income time series process, this paper presents a general...

EVA is a variant of residual income marketed by Stern Stewart amp; Co., a New York consulting firm, with the purpose of promoting value-maximising behaviour in corporate managers. This paper reviews the EVA system in the light of this purpose. First, it outlines the rationale for the use of...

EVA is a variant of residual income marketed by Stern Stewart amp; Co., a New York consulting firm, with the purpose of promoting value-maximising behaviour in corporate managers. This paper reviews the EVA system in the light of this purpose. First, it outlines the rationale for the use of...

Prior research using the residual income valuation model and linear information models has generally found that estimates of firm value are negatively biased. We argue that this could result from the way in which accounting conservatism effects are reflected in such models. We build on the...