The Effect of Matching on Firm Earnings Components

Using a sample of all U.S. firms listed on the U.S. major stock exchanges for the period covering 1988 through 2014, we investigate the relation between firm earnings components and matching. Following the methodology of Hui et al. (2016), we decompose earnings into industry-wide and firm-specific earnings. Then, we partition them into cash flows and accruals, four earnings components. As our matching measure, we use the correlation between revenues and expenses over the five-year rolling period. We investigate how matching affects the persistence of each earnings component and our results indicate that matching enhances the persistence of earnings components. Furthermore, our study shows that the effect is more outstanding on firm-specific accruals, which are more prone to the management discretion, than cash flows.JEL Codes - G14; M4

Clinicopathological features of infiltrating lobular carcinomas comparing with infiltrating ductal carcinomas: a case control study

BACKGROUND: Infiltrating lobular carcinoma (ILC) is the second most common type of invasive breast cancers and it has been reported to have some unique biologic and epidemiologic characteristics. METHODS: Clinicopathological features of 95 patients with ILC, their relapse free survival (RFS) and overall survival (OS) were retrospectively investigated and compared with those of 3,621 patients with infiltrating ductal carcinoma-not otherwise specified (IDC-NOS) between January 1984 and December 2005. RESULTS: ILC constitutes 2.3% of all invasive breast cancers. There were no difference between the ILC and the IDC-NOS groups regarding age at diagnosis, tumor size, nodal status, and treatment modalities except hormone therapy. The ILC group showed more estrogen receptor expression, less HER-2 expression and higher bilaterality. RFS and OS of the ILC patients were similar to those of the IDC. IDC-NOS metastasized more frequently to the lung and bone, whereas, ILC to the bone and ovary. CONCLUSIONS: The incidence of ILC was relatively low in Korean breast cancer patients. Comparing to IDC-NOS ILC showed some different features such as higher estrogen receptor expression, less HER-2 expression, higher bilaterality and preferred metastatic sites of bone and ovary. Contralateral cancers and bone and ovary evaluation should be considered when monitoring ILC patients

Stock Return Synchronicity and Analysts’ Forecast Properties

Using stock return synchronicity as a measure of a firm’s information environment, our research investigates how the firms’ stock return synchronicity affects analysts’ forecast properties for the accuracy and optimism of the analysts’ annual earnings forecasts. Stock return synchronicity represents the degree to which market and industry information explains firm-level stock return variations. A higher stock return synchronicity indicates the higher quality of a firm’s information environment, because a firm’s stock price reflects more market-level and industry-level information relative to firm-specific information. Our study shows that stock return synchronicity positively affects the forecast properties. Our finding shows that when stock return synchronicity is high, analysts’ annual earnings forecasts are more accurate and less optimistically biased

Financial Distress and Audit Report Lags: An Empirical Study in Korea

This study examines the association between a firm’s financial distress and audit report lags. Through this analysis, we intend to reveal whether auditors consider the clients’ financial distress when performing external audits. This study employs 2,786 firmyear observations from 2011 to 2018. The sample of this study consists of companies listed on the Korea Composite Stock Price Index (KOSPI) and the Korea Securities Dealers Automated Quotation (KOSDAQ). We perform OLS regression analysis to test our hypothesis. The OLS regression analysis is conducted through the SAS and STATA programs. We find that there is a significant and positive association between financial distress and audit report lags. The audit report lags increase as the likelihood of clients’ financial distress increases. The results indicate that audits take different amounts of audit effort when auditors consider financial distress as a business risk when they conduct audits. In other words, we provide evidence that auditors increase the amount of audit effort when the likelihood of clients’ financial distress is high. In the absence of studies on how external auditors respond to audited firms' financial distress, this study analyzes whether external auditors change their audit efforts by assessing the audited firms' financial distress. Second, the empirical result that external auditors actually follow the guidelines related to business risk and financial distress specified in the Korean Auditing Standards supports the effectiveness of the business risk-related regulations specified in the Korean Auditing Standard

A Study on the Lateral Load Capacity of a Novel Hybrid Monopile via a Centrifuge Model Test

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