Negative Special Items and Future Earnings: Expense Transfer or Real Improvements?

2012 ◽  
Vol 87 (4) ◽  
pp. 1165-1195 ◽  
Author(s):  
William M. Cready ◽  
Thomas J. Lopez ◽  
Craig A. Sisneros
Keyword(s):  
Performance Improvement ◽  
Future Earnings ◽  
Goodwill Impairment ◽  
Special Items ◽  
Performance Improvements ◽  
Current Period ◽  
Future Performance ◽  
Improvement Effect ◽  
Restructuring Charges ◽  
Transfer Device

ABSTRACT Burgstahler et al. (2002) investigate the implications of special items for future earnings and report that firms use negative special items to accelerate the recognition of future expenses into the current period. That is, negative special items serve as an “inter-period transfer” device. We extend their analysis and find that earnings increase in post-special item quarters beyond the four quarters considered in Burgstahler et al. (2002). In particular, we find that future earnings increase over the subsequent 16 quarters by more than 130 percent of the reported negative special item. The earnings increases are greater for restructuring charges than for asset write-downs or goodwill impairment charges. Such patterns suggest that negative special items also signal real future performance improvements (i.e., performance improvement hypothesis) in addition to inter-period expense transfer (i.e., inter-period transfer hypothesis). Moreover, the real improvement effect appears to be driven by restructuring charges, the most prevalent type of special item.

Special Items: A Descriptive Analysis

2011 ◽  
Vol 25 (3) ◽  
pp. 511-536 ◽  
Author(s):  
Peter M. Johnson ◽  
Thomas J. Lopez ◽  
Juan Manuel Sanchez
Keyword(s):  
Firm Value ◽  
Temporal Frequency ◽  
Descriptive Analysis ◽  
Financial Statements ◽  
Comprehensive Analysis ◽  
The Other ◽  
Future Earnings ◽  
Special Items ◽  
Increasing Function ◽  
Frequency Magnitude

SYNOPSIS We provide a comprehensive analysis of special items and the characteristics of the firms that recognize them. Our analysis reveals that the temporal frequency, magnitude, and persistence of special items has increased significantly in the last 30 years, and that such increases are primarily driven by negative special items. More recently, however, our evidence is consistent with both a decline in frequency and magnitude of negative special items. On the other hand, we find that the frequency of reporting of positive special items, which remained relatively constant through 2002, has increased in more recent years. We also find strong evidence that subsequent special item reporting is an increasing function of the frequency of “prior” special item reporting. Using a random subsample of firms reporting special items, we document that 22 percent of the amounts reported in Compustat do not reconcile with the amounts reported on the firms' actual financial statements. Our comprehensive analysis should be of interest to regulators, academics, and managers interested in the implications of special items on firm-related consequences such as future earnings and firm value. Our examination can also serve as a catalyst for researchers interested in extending this important area of inquiry.

Performance Improvement Through Indexing of Turbine Airfoils: Part 1 — Experimental Investigation

1995 ◽  
Author(s):  
F. W. Huber ◽  
P. D. Johnson ◽  
O. P. Sharma ◽  
J. B. Staubach ◽  
S. W. Gaddis
Keyword(s):  
Performance Improvement ◽  
Space Shuttle ◽  
Computational Procedure ◽  
Analytical Investigation ◽  
Test Facility ◽  
Test Article ◽  
Performance Improvements ◽  
Turbine Stator ◽  
Turbine Performance ◽  
Cfd Analyses

This paper describes the results of a study to determine the performance improvements achievable by circumferentially indexing successive rows of turbine stator airfoils. An experimental / analytical investigation has been completed which indicates significant stage efficiency increases can be attained through application of this airfoil clocking concept. A series of tests was conducted at the National Aeronautics and Space Administration’s (NASA) Marshall Space Flight Center (MSFC) to experimentally investigate stator wake clocking effects on the performance of the Space Shuttle Main Engine Alternate Fuel Turbopump Turbine Test Article. Extensive time-accurate Computational Fluid Dynamics (CFD) simulations have been completed for the test configurations. The CFD results provide insight into the performance improvement mechanism. Part one of this paper describes details of the test facility, rig geometry, instrumentation, and aerodynamic operating parameters. Results of turbine testing at the aerodynamic design point are presented for six circumferential positions of the first stage stator, along with a description of the initial CFD analyses performed for the test article. It should be noted that first vane positions 1 and 6 produced identical first to second vane indexing. Results obtained from off-design testing of the “best” and “worst” stator clocking positions, and testing over a range of Reynolds numbers are also presented. Part two of this paper describes the numerical simulations performed in support of the experimental test program described in part one. Time-accurate Navier-Stokes flow analyses have been completed for the five different turbine stator positions tested. Details of the computational procedure and results are presented. Analysis results include predictions of instantaneous and time-average mid-span airfoil and turbine performance, as well as gas conditions throughout the flow field. An initial understanding of the turbine performance improvement mechanism is described.

Supplier performance measurement system use, relationship trust, and performance improvement: a dyadic perspective

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Vieri Maestrini ◽  
Andrea Stefano Patrucco ◽  
Davide Luzzini ◽  
Federico Caniato ◽  
Paolo Maccarrone
Keyword(s):  
Performance Measurement ◽  
Performance Improvement ◽  
Measurement System ◽  
Structural Equation ◽  
Performance Measurement System ◽  
Content Type ◽  
Performance Improvements ◽  
Supplier Performance ◽  
Performance Measurement Systems ◽  
The Impact

PurposeGrounding on resource orchestration theory, this paper aims to study the relationship between the way buying companies use their supplier performance measurement systems and the performance improvements obtained from suppliers, with relationship trust identified as a mediator in the previous link.Design/methodology/approachThe authors design a conceptual model and test it through structural equation modelling on a final sample of 147 buyer-supplier responses, collected by means of a dyadic survey.FindingsResults suggest that the buyer company may achieve the most by balancing a diagnostic and interactive use of the measurement system, as they are both positively related to supplier performance improvement. Furthermore, relationship trust acts as a mediator in case of the interactive use, but not for the diagnostic. This type of use negatively affects relationship trust, due to its mechanistic use in the buyer-supplier relationship.Originality/valueThe authors’ results contribute to the current academic debate about supplier performance measurement system design and use by analyzing the impact of different supplier performance measurement system uses, and highlighting their relative impact on relationship trust and supplier performance improvement. From a methodological perspective, adopting a dyadic data collection process increases the robustness of the findings.

Performance Testing of L-PBF Produced Honeycombs Out of IN625

2021 ◽  
Author(s):  
Timo Heitmann ◽  
Ole Geisen ◽  
Lisa Hühn ◽  
Oliver Munz ◽  
Andreas Bardenhagen
Keyword(s):  
Mass Flow Rate ◽  
Mass Flow ◽  
Flow Rate ◽  
Performance Testing ◽  
Inconel 625 ◽  
Performance Improvements ◽  
Future Performance ◽  
Rubbing Behavior ◽  
Honeycomb Cell ◽  
Metallic Parts

Abstract Laser Powder Bed Fusion (L-PBF) enables the production of complex metallic parts. Processes using pulsed wave (PW) laser radiation have been proven to be well suited to build thin-walled honeycomb structures. However, the behavior of these structures under load conditions remains mostly unexplored. The objective of this paper is to characterize L-PBF produced honeycombs by investigating their rub and leakage performance. A pulse modulated process based on previous studies is optimized for productivity and used to build L-PBF test samples out of Inconel 625 (IN625). The honeycomb cell geometry is adjusted for improved printability of the overhanging walls. Repeatable L-PBF production of honeycombs with a wall thickness of about 100 μm is confirmed. Conventionally manufactured honeycomb samples out of sheet metal are tested as reference. The rub experiments cover radial incursion rates of up to 0.5 mm/s and relative velocities of up to 165 ms−1 at incursion depths (ID) between 0.5 and 2.0 mm. Lower incursion forces are observed for the L-PBF components, with a higher degree of abrasion. The leakage tests examine the mass flow rate for pressure ratios between 1.05 and 2.0 at constant gap size and constant back pressure. The L-PBF honeycomb seals show a higher mass flow rate, with the slightly larger cell size and higher surface roughness appearing to be the main influencing factors. Overall, improved rubbing behavior and 10 % higher leakage than the conventional probes demonstrate the applicability of L-PBF for honeycomb sealing systems. Future performance improvements through dedicated L-PBF designs can be expected.

Managerial Equity Holdings and Income Smoothing Incentives

2017 ◽  
Vol 31 (1) ◽  
pp. 195-218 ◽  
Author(s):  
Sydney Qing Shu ◽  
Wayne B. Thomas
Keyword(s):  
Risk Taking ◽  
Agency Problems ◽  
Discretionary Accruals ◽  
Stock Option ◽  
Income Smoothing ◽  
Future Earnings ◽  
Future Performance ◽  
Excessive Risk Taking ◽  
Excessive Risk ◽  
Equity Holdings

ABSTRACT We explore how managerial stock holdings and option holdings affect CEOs' income smoothing incentives. Given the different roles of stock holdings and option holdings in solving agency problems, managers may smooth past earnings using discretionary accruals for the purpose of revealing information to help investors better predict future earnings or for the purpose of hiding volatility of past earnings. We find the association between past smoothing and predictability of future earnings is increasing (decreasing) in CEO stock (option) holdings. Results are consistent with stock holdings aligning the interests of managers and shareholders, and managers using discretionary accruals to smooth past earnings to reveal information to investors about future performance. In contrast, option holdings have been linked with excessive risk taking by managers, and managers use discretionary accruals to mask volatility of less predictable earnings. We demonstrate that income smoothing can be informative or opportunistic, depending on the incentives of CEOs.

Performance Improvements of Random Dopant Fluctuation-Induced Variability in Negative Capacitance MOSFETS

2019 ◽  
Vol 19 (01) ◽  
pp. 2050002
Author(s):  
W. F. Lü ◽  
L. Dai ◽  
Z. F. Zhao ◽  
M. Lin
Keyword(s):  
Performance Improvement ◽  
Decisive Role ◽  
Feedback Mechanism ◽  
Negative Capacitance ◽  
Performance Parameters ◽  
Performance Improvements ◽  
Random Dopant Fluctuation ◽  
Statistical Variations ◽  
The Impact ◽  
Random Dopant

In this paper, we investigate the impact of random dopant fluctuation (RDF) on the statistical variations in negative capacitance MOSFETs (NCFETs) through a device simulation coupled with the Landau–Khalatnikov (LK) equation. Compact models for feedback mechanisms that are based on the internal gate voltage amplification in NCFETs are proposed. The results show that internal voltage amplification plays a decisive role in performance improvement of device variability. Further, our simulation study demonstrates that owing to the feedback mechanism, the dispersions of the performance parameters in NCFETs exhibit different statistical distribution characteristics compared to their MOSFET counterparts. Our study may provide further insight regarding device and/or circuit designs utilizing NCFETs.

Big Bath Earnings Management: The Case Of Goodwill Impairment Under SFAS No. 142

2011 ◽  
Vol 20 (2) ◽  
Author(s):  
Charles E. Jordan ◽  
Stanley J. Clark
Keyword(s):  
Earnings Management ◽  
Compelling Evidence ◽  
Font Size ◽  
Goodwill Impairment ◽  
Current Period ◽  
Fortune 100 ◽  
Big Bath

<p class="MsoBodyText2" style="text-align: justify; margin: 0in 0.5in 0pt;"><span style="font-style: normal; mso-bidi-font-style: italic;"><span style="font-size: x-small;"><span style="font-family: Times New Roman;">The big bath theory of earnings management suggests that firms experiencing low earnings in a given year may take discretionary write downs to reduce even further the current period&rsquo;s earnings.<span style="mso-spacerun: yes;">&nbsp; </span>The notion is that the company and its management will not be punished proportionately more for the big hit it takes to its already depressed earnings.<span style="mso-spacerun: yes;">&nbsp; </span>This &ldquo;clearing of the decks&rdquo; makes it easier to generate higher profits in later years.<span style="mso-spacerun: yes;">&nbsp; </span>SFAS No. 142, with its new requirement to test goodwill annually for impairment, provided a unique opportunity to test this big bath theory.<span style="mso-spacerun: yes;">&nbsp; </span>Examining Fortune 100 companies, this study presents compelling evidence that the big bath theory is more than just a theory but is instead a practiced method of managing earnings.</span></span></span></p>

Constructing an adaptive care model for the management of disease-related symptoms throughout the course of multiple sclerosis—performance improvement CME

2013 ◽  
Vol 20 (1) ◽  
pp. 18-23 ◽  
Author(s):  
Aaron E Miller ◽  
Bruce A Cohen ◽  
Stephen C Krieger ◽  
Clyde E Markowitz ◽  
David H Mattson ◽  
...  
Keyword(s):  
Multiple Sclerosis ◽  
Performance Improvement ◽  
Symptom Management ◽  
Mobility Impairment ◽  
Care Model ◽  
Performance Improvements ◽  
Care Plans ◽  
Measure Change ◽  
New Perspective ◽  
Expert Faculty

Background: Symptom management remains a challenging clinical aspect of MS. Objective: To design a performance improvement continuing medical education (PI CME) activity for better clinical management of multiple sclerosis (MS)-related depression, fatigue, mobility impairment/falls, and spasticity. Methods: Ten volunteer MS centers participated in a three-stage PI CME model: A) baseline assessment; B) practice improvement CME intervention; C) reassessment. Expert faculty developed performance measures and activity intervention tools. Designated MS center champions reviewed patient charts and entered data into an online database. Stage C data were collected eight weeks after implementation of the intervention and compared with Stage A baseline data to measure change in performance. Results: Aggregate data from the 10 participating MS centers (405 patient charts) revealed performance improvements in the assessment of all four MS-related symptoms. Statistically significant improvements were found in the documented assessment of mobility impairment/falls ( p=0.003) and spasticity ( p<0.001). For documentation of care plans, statistically significant improvements were reported for fatigue ( p=0.007) and mobility impairment/falls ( p=0.040); non-significant changes were noted for depression and spasticity. Conclusions: Our PI CME interventions demonstrated performance improvement in the management of MS-related symptoms. This PI CME model (available at www.achlpicme.org/ms/toolkit ) offers a new perspective on enhancing symptom management in patients with MS.

Financial performance following discontinued operations

2020 ◽  
Vol 19 (4) ◽  
pp. 429-447
Author(s):  
Binod Guragai ◽  
Paul D. Hutchison
Keyword(s):  
Financial Performance ◽  
Performance Improvement ◽  
Least Square ◽  
Regulatory Change ◽  
Content Type ◽  
Future Performance ◽  
Regulatory Rule ◽  
Prior Literature ◽  
The Impact ◽  
Discontinued Operations

Purpose Prior literature provides empirical evidence that financial performance improves for core remaining operations after a firm discontinues some of their operations. This study aims to examine whether the association between discontinued operations and future financial performance improvement is affected by a regulatory rule (i.e. Statement of Financial Accounting Standards 144 [SFAS 144]) that significantly altered the reporting requirements of discontinued operations. This study also examines whether the association is dependent on the profitability of the operations discontinued. Design/methodology/approach Ordinary least square regressions are used to test the association between discontinued operations and financial performance improvement, conditional on the profitability of operations discontinued in the pre-SFAS 144 and SFAS 144 regulatory regimes. Data on profitability of operations discontinued is hand-collected. Findings Results suggest that firms experience improvement in financial performance following the reporting of discontinued operations in the pre-SFAS 144 era. Using hand-collected data on the profitability of operations discontinued, this research study also shows that improvement in performance is stronger for firms that discontinue loss operations compared to those that discontinue profitable operations. Originality/value This study explores the impact of regulatory change on the association between discontinued operations and future performance. Furthermore, unique hand-collected data is used to understand whether financial performance improvement is conditional on the profitability of the operations discontinued. Results documented in this paper should be of interest to investors, regulators and analysts in understanding the long-term strategic implications of discontinued operations.

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