Effects of financial constraints and earnout payment on acquirer’s earnings management

Esta dissertação examina manipulação de resultados em aquisições. Em particular, avalia se empresas adquirentes, com restrições financeiras, manipulam mais em comparação com empresas adquirentes sem restrições financeiras. Adicionalmente, esta dissertação avalia o uso do earnout e a sua eficácia na redução da manipulação dos resultados. Os resultados empíricos, usando dois tipos de modelos de manipulação de resultados (accruals e real activity management), demonstam que os adquirentes com restrições financeiras não parecem manipular mais do que os adquirentes sem restrições financeiras no período anterior à aquisição. Os resultados sugerem ainda que os adquirentes que utilizam earnout como forma de pagamento estão associados a um menor nível de manipulação de resultados por via de accruals. Os resultados sugerem também que os adquirentes que adquirem empresas estrangeiras ou empresas noutro setor através de earnout, estão associados a um menor nível de manipulação de resultados por via de real activity management. Conclui-se assim que a utilização de earnout como método de pagamento reduz o nível de manipulação de resutados dos adquirentes e, consequentemente, aumenta a qualidade dos resultados.This work examines whether and how constrained acquirers are showing higher levels of earnings management in the past financial statements compared to unconstrained acquirer. Further, this paper contributes to the growing literature on the use of earnout and its effectiveness to reduce earnings management. The empirical results, using both accruals management and real activity management models, show that constrained acquirers do not experience higher levels of earnings management in the period before the acquisition. Further, the results demonstrate that bidders using earnout as method of payment are associated to lower level of earnings management in their past financial statement via discretionary accruals. Also, the results suggest that bidders that enter in foreign and diversifying acquisitions involving earnouts report lower levels of real earnings manipulation. Moreover, earnout as method of payment reduces the level of earnings management from a bidder’s perspective, thus increasing earnings quality

An update to "The cost-effectiveness of rotavirus vaccination: comparative analyses for five European countries and transferability in Europe".

A cost-effectiveness analysis of rotavirus vaccination in Belgium, England and Wales, Finland, France and the Netherlands published in 2009 was updated based on recent studies on rotavirus burden of disease and vaccine efficacy. All the qualitative conclusions in the previous study were found to remain valid. Vaccination remains cost-effective in Finland only when using plausible tender prices

The cost-effectiveness of rotavirus vaccination: Comparative analyses for five European countries and transferability in Europe.

Cost-effectiveness analyses are usually not directly comparable between countries because of differences in analytical and modelling assumptions. We investigated the cost-effectiveness of rotavirus vaccination in five European Union countries (Belgium, England and Wales, Finland, France and the Netherlands) using a single model, burden of disease estimates supplied by national public health agencies and a subset of common assumptions. Under base case assumptions (vaccination with Rotarix, 3% discount rate, health care provider perspective, no herd immunity and quality of life of one caregiver affected by a rotavirus episode) and a cost-effectiveness threshold of euro30,000, vaccination is likely to be cost effective in Finland only. However, single changes to assumptions may make it cost effective in Belgium and the Netherlands. The estimated threshold price per dose for Rotarix (excluding administration costs) to be cost effective was euro41 in Belgium, euro28 in England and Wales, euro51 in Finland, euro36 in France and euro46 in the Netherlands