Anticipating Future Earnings

The Donald A Corbin Distinguished Professor of Accounting Hamid Pourjalali published “The Impact of IAS No 27 on the Market's Ability to Anticipate Future Earnings,” in Contemporary Accounting Research.  This co-authored paper shows that statements prepared under IAS 27 can better portray the economic performance of the group and provide a clearer signal of future performance. Following the IAS 27 definition can also reduce managers’ ability to manage earnings through affiliated transactions. The affected firms show fewer affiliated transactions after IAS 27 adoption.