The Impact of Reputation on the Informativeness of Earnings and Accounting Choices
Abstract
The article hypothesizes that the level of reputation affects both the informativeness of earnings and the magnitude of discretionary accounting accrual adjustments. The hypothesis exploits the following: the positive relationship between reputation and firms' risk‐return profiles, and managers' incentives in using discretionary accounting accrual adjustments. Results show that reputation is positively associated with earnings' explanatory power for returns, and related to the magnitude of accounting accrual adjustments.
Citation
AlNajjar, F.K. and Riahi‐Belkaoui, A. (2002), "The Impact of Reputation on the Informativeness of Earnings and Accounting Choices", Review of Accounting and Finance, Vol. 1 No. 1, pp. 88-101. https://doi.org/10.1108/eb026981
Publisher
:MCB UP Ltd
Copyright © 2002, MCB UP Limited