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Conference Paper: The valuation impact of reconciling pro forma earnings to GAAP earnings

TitleThe valuation impact of reconciling pro forma earnings to GAAP earnings
Authors
KeywordsPro Forma Earnings
Valuation
Regulation G
Issue Date2011
PublisherElsevier B.V..
Citation
30th European Accounting Association (EAA) Annual Congress, Lisbon, 25-27 April 2007, v. 51 n. 1-2, p. 186-202 How to Cite?
AbstractRegulation G requires all companies to quantitatively reconcile pro forma earnings with GAAP earnings. This paper provides three findings related to the impact of reconciliations on mispricing of pro forma earnings. First, prior to Reg G, we find that mis-pricing of pro forma earnings is limited to firms with low reconciliation quality. There is no evidence of mispricing for firms with high reconciliation quality. Second, we find no evidence of mispricing after Reg G. Third, there is a cross-Reg G reduction of mispricing for firms whose reconciliation quality improves, and there continues to be no-mispricing for firms that have high reconciliation quality both before and after Reg G. Together, our results support the notion that better reconciliations reduce the extent of mispricing.
Persistent Identifierhttp://hdl.handle.net/10722/202262
ISSN
2015 Impact Factor: 3.535
2015 SCImago Journal Rankings: 6.834
ISI Accession Number ID

 

DC FieldValueLanguage
dc.contributor.authorZhang, H-
dc.contributor.authorZheng, L-
dc.date.accessioned2014-09-01T03:33:21Z-
dc.date.available2014-09-01T03:33:21Z-
dc.date.issued2011-
dc.identifier.citation30th European Accounting Association (EAA) Annual Congress, Lisbon, 25-27 April 2007, v. 51 n. 1-2, p. 186-202-
dc.identifier.issn0165-4101-
dc.identifier.urihttp://hdl.handle.net/10722/202262-
dc.description.abstractRegulation G requires all companies to quantitatively reconcile pro forma earnings with GAAP earnings. This paper provides three findings related to the impact of reconciliations on mispricing of pro forma earnings. First, prior to Reg G, we find that mis-pricing of pro forma earnings is limited to firms with low reconciliation quality. There is no evidence of mispricing for firms with high reconciliation quality. Second, we find no evidence of mispricing after Reg G. Third, there is a cross-Reg G reduction of mispricing for firms whose reconciliation quality improves, and there continues to be no-mispricing for firms that have high reconciliation quality both before and after Reg G. Together, our results support the notion that better reconciliations reduce the extent of mispricing.-
dc.languageeng-
dc.publisherElsevier B.V..-
dc.relation.ispartofJournal of accounting & economics-
dc.rightsCreative Commons: Attribution 3.0 Hong Kong License-
dc.subjectPro Forma Earnings-
dc.subjectValuation-
dc.subjectRegulation G-
dc.titleThe valuation impact of reconciling pro forma earnings to GAAP earningsen_US
dc.typeConference_Paperen_US
dc.identifier.emailZheng, L: lzheng@business.hku.hk-
dc.identifier.doi10.1016/j.jacceco.2010.07.001-
dc.identifier.hkuros170652-
dc.identifier.volume51-
dc.identifier.issue1-2-
dc.identifier.spage186-
dc.identifier.epage202-
dc.identifier.isiWOS:000288309300011-
dc.publisher.placeUnited States-

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