Evidence that the zero-earnings discontinuity has disappeared

• 成果类型: Article
• 署名作者: Gilliam, Thomas A.; Heflin, Frank; Paterson, Jeffrey S.
• 署名单位: IE University; State University System of Florida; Florida State University
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2014.07.001
• 发表日期: 2015
• 关键词: management; real; decreases; kinky

摘要

Discontinuities in earnings distributions at zero have been widely cited as evidence of earnings management but not without controversy. Recent research suggests discontinuities may be mere artifacts of certain research design choices. We find that the well-known zero-earnings discontinuity disappears soon after passage of the Sarbanes-Oxley Act (SOX) and has not returned. We also find that neither the discontinuity nor its disappearance require the effects of widely cited alternative (non-earnings management) explanations for the zero-earnings discontinuity. (C) 2014 Elsevier BM. All rights reserved.