Open AccessThe development of earnings quality in Germany and its implication for further research. A quantitative empirical analysis of German listed companies between 1997 and 2006
Author(s) -
Paul Pronobis,
Bernhard Schwetzler,
Marco O. Sperling,
Henning Zuelch
Publication year - 2009
Publication title -
corporate ownership and control
Language(s) - English
Resource type - Journals
eISSN - 1810-0368
pISSN - 1727-9232
DOI - 10.22495/cocv7i1c4p2
Subject(s) - german , earnings quality , earnings , accounting , business , sample (material) , quality (philosophy) , relevance (law) , earnings management , value (mathematics) , earnings response coefficient , accrual , statistics , chromatography , political science , philosophy , chemistry , archaeology , epistemology , law , history , mathematics
This paper investigates the development of earnings quality for a sample of 5,817 firm years during the period between 1997 and 2006 using seven different measures (accounting- and market-based). As a result, overall earnings quality of German firms improves over time. However, the measures of timeliness and value relevance indicate a decreasing earnings quality. These findings are tested by taking firm-specific accounting style into consideration using firm fixed effects.