[Recent studies have considered the association between abnormal stock returns and forecast errors of various components of earnings. For discretionary outlays such as advertising or research and development (R&D), the sign and magnitude of the association between forecast errors and abnormal returns can provide information concerning the expected duration of benefits arising from these activities. This empirical study compares market reaction to advertising and R&D forecast errors with market reaction to forecast errors for conventional expenses, and with a theoretical benchmark for long-lived assets. The results are mixed, but on balance the evidence is consistent with a market assessment that advertising is short-lived while R&D is long-lived.]

ABSTRACT: The FASB has issued computer data tapes for both pension disclosures and inflation-adjusted amounts. This note reports the results of a comparison of a sample of data from the FASB data tapes with amounts from the annual reports. This study warns future users of the tapes of potential pitfalls in their use. All errors have been reported to the FASB for their use in updating the tapes.

[Little empirical research exists concerning the factors most conducive to research and publication activity by academic accountants. Thus, the basic question addressed by this study is: In the academic accounting community, what are the predominant characteristics of the "research environment" associated with publication activity? Responses by 208 academic accountants to a mailed questionnaire indicate the overall perception that access to the computer and two other categories of research facilitators are particularly important. Those categories are time-related items (reduced teaching loads and committee assignments) and people-related items (abilities/quality of fellow faculty members and graduate students). Employers are perceived by respondents as providing/supporting people-related items the best, access to the computer next, and time-related items the least. Responses are analyzed in terms of doctoral-granting programs, divided into two groups, and nondoctoral-granting programs. Results based on alternative grouping schemes are also reported.]

ABSTRACT: Recent studies have considered the association between abnormal stock returns and forecast errors of various components of earnings. For discretionary outlays such as advertising or research and development (R&D), the sign and magnitude of the association between forecast errors and abnormal returns can provide information concerning the expected duration of benefits arising from these activities. This empirical study compares market reaction to advertising and R&D forecast errors with market reaction to forecast errors for conventional expenses, and with a theoretical benchmark for long-lived assets. The results are mixed, but on balance the evidence is consistent with a market assessment that advertising is short-lived while R&D is long-lived.

Bruce Bublitz, Thomas J. Frecka, James C. McKeown, Market Association Tests and FASB Statement No. 33 Disclosures: A Reexamination, Journal of Accounting Research, Vol. 23, Studies on Accounting Earnings and Security Valuation: Current Research Issues (1985), pp. 1-23