Analysts' Selective Provisions of Cash Flow Forecasts

dc.contributor.authorYoo, Choong-Yuelen
dc.contributor.supervisorSalterio, Stevenen
dc.date2009-05-27 16:20:09.248's University at Kingstonen
dc.descriptionThesis (Ph.D, Management) -- Queen's University, 2009-05-27 16:20:09.248en
dc.description.abstractIn this thesis, I examine the factors associated with analysts’ voluntary practice of issuing cash flow forecasts and earnings forecasts on the same day. I draw on Hughes and Pae’s (2004) management partial disclosure equilibrium and predict how an analyst decides to issue a cash flow forecast revision along with and according to her bad news and good news earnings forecast revision. In particular, I predict that analysts strategically choose to supplement earnings forecasts with positive cash flow news when they deliver bad news earnings forecasts. Consistent with my prediction, I find that analysts are more likely to issue cash flow forecast revisions in the opposite direction to their earnings forecast revisions when they issue downward earnings forecast revisions than when they issue upward earnings forecast revisions. The results suggest that analysts may not make their decisions to issue cash flow forecasts as objectively as they ought to do in their role as independent information intermediaries. Rather, analyst decisions to issue cash flow forecasts are akin to managers’ strategic decisions to voluntarily disclose supplemental information to affect investors’ confidence in their primary news (earnings forecasts).en
dc.format.extent1870730 bytes
dc.relation.ispartofseriesCanadian thesesen
dc.rightsThis publication is made available by the authority of the copyright owner solely for the purpose of private study and research and may not be copied or reproduced except as permitted by the copyright laws without written authority from the copyright owner.en
dc.subjectEarnings forecastsen
dc.subjectCash flow forecastsen
dc.subjectSignaling gamesen
dc.titleAnalysts' Selective Provisions of Cash Flow Forecastsen
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