Are earnings announced early of higher quality?. (10th December 2013)

• Record Type: Journal Article
• Authors: Lee, Ho‐Young; Mande, Vivek; Son, Myungsoo; Cahan, Steven
• Is Part Of: Accounting and finance. Volume 55:Number 1(2015:Mar.)
• Page Start: 187
• Page End: 212
• Publication Date: 2013-12-10
• Subjects: Accounting -- Periodicals; Finance -- Periodicals; 657.05
• DOI: 10.1111/acfi.12057
• Languages: English
• ISSNs: 0810-5391

Abstract

<abstract abstract-type="main" id="acfi12057-abs-0001"> <title>Abstract</title> <p>This study examines whether the timing of annual earnings announcements is related to how promptly earnings incorporate value‐relevant information (timeliness in recognition), the extent to which earnings are managed (income smoothing) and the extent to which earnings are realized into operating cash flow (accruals quality). Based on Trueman (<xref ref-type="link" rid="acfi12057-bib-0051">1990</xref>), we hypothesize that early announcers will have higher quality earnings. Our results, however, do not support these hypotheses. We find, instead, that late announcers have higher quality earnings and that earnings of late announcers recognize bad news on a more timelier basis than do earnings of early announcers.</p> </abstract>