The Representativeness of Management Earnings Forecasts.

Key Points

• This evaluation aims to determine if current management earnings forecasts are indicative of all firms’ forecasts if made mandatory.
• Analyzed attributes of firms that produce earnings forecasts.
• Conducted statistical tests on existing published management earnings forecasts.
• Assessed the representativeness of the current forecasting data.
• Previous research may not support a sound policy decision on mandatory forecasting.
• Findings indicate a lack of representativeness among current forecasts.
• Tests show variation in attributes of firms producing forecasts.