Income classification shifting involves opportunistically misclassifying core expenses into nonrecurring items in order to boost core earnings. Recent studies have documented large sample evidence of its existence (e.g. McVay 2006; Fan et al.,2010; Barua et al.,2010). Managers engage in income classification shifting because they believe the market in general and financial analysts in particular focus on core earnings. If financial analysts are experts in forecasting permanent earnings, they should be expected to identify reported core earnings that have been inflated through classification shifting and revise their future earnings forecast accordingly. Consistent with my prediction, I find that given the same amount of earnings news, analysts revise their future quarterly earnings forecasts by half as much for classification shifters than for non-classification shifters, suggesting analysts recognize that income classification shifters core earnings are less likely to persist into the future. However, I also find that analysts fail to fully gauge the impact of classification shifting on future earnings, leading to more optimistically biased forecasts for classification shifters. Finally, classification shifting makes it more difficult for analysts to forecast earnings so that their forecasts become less accurate.

<p>I examine the decision usefulness of the equity method of accounting from two perspectives. First, I examine the value relevance of information provided under the equity method relative to the value relevance of information resulting from measuring investments in affiliates at fair value. For a sample of 221 U.S. investors with publicly-traded affiliates during 1993-2011, I find that balance sheet measures of investments in publicly-traded affiliates provided under the equity method are associated with investors' stock prices, but income from these affiliates recognized under the equity method is not associated with investors' stock prices. In addition, fair value balance sheet and income measures of investments in publicly-traded affiliates are incrementally associated with investors' stock prices after controlling for information provided under the equity method. The incremental value relevance of fair value measures for investments in publicly-traded affiliates exists for both investments identified as held for sale and those identified as strategic, with no evidence that the incremental value relevance is higher (lower) for investments identified as held for sale (strategic). This result suggests that the 2010 and 2013 proposals by the U.S. Financial Accounting Standards Board to distinguish between investments in affiliates based on management's intended method of value realization are not supported by differences in the relative value relevance of fair value measures for these types of investments. Second, I evaluate whether equity method investors use their significant influence to manage income reported under the equity method. For a sample of 202 U.S. firms from 1993-2011, I find that signed discretionary accruals of affiliates are higher when income from affiliates allows investors to meet earnings targets. This result is consistent with equity method investors influencing the financial reporting of affiliates to achieve earnings targets.</p> / Dissertation

<p>In this study, I examine whether managers make self-serving attributions by internally (externally) attributing favorable (unfavorable) performance or demonstrate leadership by accepting blame and deflecting praise when communicating with analysts and investors. After validating the attribution measure I use in this paper, I find that managers tend to attribute favorable performance to internal factors and unfavorable performance to external factors, consistent with self-serving attribution being the dominant force. I also find that investors react negatively to mangers' internal attributions. Further analysis reveals that more internal attributions are associated with lower earnings persistence.</p> / Dissertation

Thesis (PH.D.) -- Syracuse University, 2007. / "Publication number AAT 3266279"

Thesis (Honors)--Liberty University Honors Program, 2007.

Inaug.-diss.--Erlangen. / Lebenslauf. "Verzeichnis der verwendeten schriftwerke": p. 93-95.

Thesis (Ph. D.)--Ohio State University, 1975. / Includes vita. Includes bibliographical references (leaves 208-225). Available online via OhioLINK's ETD Center.

Thesis (doctoral)--Universität Bern.

Thesis (doctoral)--Universität Bern, 1940. / Includes bibliographical references (ix-xii).

Thesis (Ph. D.)--University of Washington, 1991. / Vita. Includes bibliographical references (leaves [287]-304).