Date of this Version
Journal of Accounting Research
We decompose quantitative management earnings forecasts into macroeconomic and firm-specific components to determine the extent to which voluntary disclosure provided by management has macroeconomic information content. We provide evidence that the forecasts of bellwether firms, which are defined as firms in which macroeconomic news explains the greatest amount of variation in the forecasts, provide timely information to the market about the macroeconomy when bundled with earnings announcements. Further, we show that bellwether firms provide timely information about both industry-specific events and broader economic events. Finally, we document that the macroeconomic news in individual forecasts is more pronounced for bad news and point forecasts.
This is the peer reviewed version of the following article: BONSALL, S. B., BOZANIC, Z. and FISCHER, P. E.. (2013), What Do Management Earnings Forecasts Convey About the Macroeconomy?. Journal of Accounting Research, 51: 225–266., which has been published in final form at http://dx.doi....75-679X.12007. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Self-Archiving http://olabout.wiley.com/WileyCDA/Section/id-820227.html#terms.
voluntary disclosure, management earnings forecasts, bellwether firms, macroeconomic risk
Bonsall, S. B., Bozanic, Z., & Fischer, P. E. (2013). What Do Management Earnings Forecasts Convey About the Macroeconomy?. Journal of Accounting Research, 51 (2), 225-266. http://dx.doi.org/10.1111/1475-679X.12007
Date Posted: 27 November 2017
This document has been peer reviewed.