Earnings quality on the street
基于一家研究公司对230家企业在2004-2009年间613份激进报告的分析，构建了一个包含51个信号的盈余质量评分（EQSCORE），该评分能有效识别会计和审计违规及预测未来股票收益。
Abstract We develop a composite firm‐year earnings quality score ( EQSCORE ) that uses signals based on fundamental analysis. We obtain a proprietary data set of 613 reports about aggressive reporting practices over 2004–2009 for 230 unique firms from a research firm (RF). From these reports, we identify red flags of poor earnings quality relating to (1) sales quality, (2) margin quality, (3) cash flow quality, (4) corporate governance, (5) audit, and (6) others. We construct the EQSCORE using 51 signals employed by the RF and a novel approach that imitates the RF's process for discovering earnings quality. The EQSCORE outperforms existing composite models of earnings quality in identifying accounting and auditing enforcement releases and restated firm‐years and predicts future stock returns. The corporate governance–related and audit‐related red flags included in the EQSCORE complement accounting‐based red flags and enhance the ability of the EQSCORE to identify firms with poor earnings quality.