Emphasis on Pro Forma Versus Gaap Earnings in Quarterly Press Releases: Determinants, Sec Intervention, and Market Reactions

By Robert M. Bowen, Angela K. Davis, Dawn A. Matsumoto. 2005

369 citations recorded by the source corpus.

View Paper: https://www.semanticscholar.org/paper/ae997affc91e00aea42d49dd90def0fde4a155b9

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Accounting

In Finance

Citations in the corpus

Are Investors Influenced by Pro Forma Emphasis and Reconciliations in Earnings Announcements (2006, methodology): “The items excluded from GAAP earnings to arrive at pro forma earnings were chosen based on earnings announcements of actual firms in the technology sector and are some of the most common items excluded as reported in previous archival research (Bhattacharya et al. 2003, 2004; Bowen et al. 2005 ).”
Discretionary Disclosure Strategies in Corporate Narratives: Incremental Information or Impression Management? (2008, neutral): “…Only eight studies (all US) have effectively distinguished between these two competing schools [Lang and Lundholm, 2000]; [Frederickson and Miller, 2004]; [Barton and Mercer, 2005]; [Bowen et al., 2005]; [Johnson and Schwartz, 2005]; [Krische, 2005]; [Elliott, 2006]; [Matsumoto et al., 2006].”
The persistence of earnings and cash flows and the role of special items: Implications for the accrual anomaly (2006, positive): “In addition, analysts typically exclude special items from their forecasts of ‘‘pro forma’’ earnings and prior research suggests that investors respond more strongly to pro forma earnings (Bradshaw & Sloan, 2002; Bowen, Davies, & Matsumoto, 2005 ) and even ignore excluded items that are recurring (”
Non-GAAP earnings and board independence (2011, background): “Consequently, opportunism can affect the choice of exclusions (Doyle et al., 2003; Bowen et al., 2005; Black and Christensen, 2009), and the nature of exclusions varies substantially both across firms and across quarters of the same firm (Bhattacharya et al., 2004).”
Are Investors Influenced By How Earnings Press Releases Are Written? (2008, positive): “The amount of unexpected earnings (UE) is calculated as actual EPS minus EPS reported in the previous year, divided by share price at the beginning of the period, consistent with previous research (e.g., Bowen et al., 2005; Lougee & Marquardt, 2004).”
The Disclosure of Non-GAAP Earnings Information in the Presence of Transitory Gains (2014, neutral): “First, prior research finds evidence that most earnings management is conducted to increase earnings (Dechow et al. 1996; Bowen et al. 2005; Graham et al. 2005).”
SEC Enforcement: Does Forthright Disclosure and Cooperation Really Matter? (2012, background): “My results also extend prior research (Bowen et al. 2005; Files et al. 2009; Gordon et al. 2009; Myers et al. 2010) by providing the first evidence on how press release prominence and the type of SEC filing used to disclose a restatement affect the SEC’s decision to issue an enforcement action.”