Disentangling Managers' and Analysts' Non-GAAP Reporting

• 成果类型: Article
• 署名作者: Bentley, Jeremiah W.; Christensen, Theodore E.; Gee, Kurt H.; Whipple, Benjamin C.
• 署名单位: University of Massachusetts System; University of Massachusetts Amherst; University System of Georgia; University of Georgia; Stanford University
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/1475-679X.12206
• 发表日期: 2018
• 页码: 1039-1081
• 关键词: pro forma earnings; street earnings; predictive-value; DISCLOSURES; exclusions; Informativeness; forecasts; guidance

摘要

Researchers frequently proxy for managers' non-GAAP disclosures using performance metrics available through analyst forecast data providers (FDPs), such as I/B/E/S. The extent to which FDP-provided earnings are a valid proxy for managers' non-GAAP reporting, however, has been debated extensively. We explore this important question by creating the first large-sample data set of managers' non-GAAP earnings disclosures, which we directly compare to I/B/E/S data. Although we find a substantial overlap between the two data sets, we also find that they differ in systematic ways because I/B/E/S (1) excludes managers' lower quality non-GAAP numbers and (2) sometimes provides higher quality non-GAAP measures that managers do not explicitly disclose. Our results indicate that using I/B/E/S to identify managers' non-GAAP disclosures significantly underestimates the aggressiveness of their reporting choices. We encourage researchers interested in managers' non-GAAP reporting to use our newly available data set of manager-disclosed non-GAAP metrics because it more accurately captures managers' reporting choices.