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Oliver Hegers

Accounting quality and financial forecasting


This dissertation contributes to our understanding of accounting quality and financial forecasting, which are interdependent concepts. While financial forecasts require accurate and relevant accounting information as input, they also generate new accounting information as output by making a prediction about the future.
In chapter 2, I find that a growth mindset is negatively associated with role conflict in a setting where business controllers are tasked with fiduciary and decision support responsibilities. However, I also find that a growth mindset strengthens the positive association between role conflict and financial misreporting and is generally positively associated with financial misreporting. This finding implies that growth mindset individuals have a more flexible view on breaking rules in an accounting context.

The empirical results of chapter 3 suggest that forecast disaggregation is negatively (positively) associated with the overall internal financial forecast error when environmental uncertainty is high (low). In addition, the contingent effect disappears when forecasters operate in a weak internal control environment. These findings suggest that random errors offset each other in disaggregated forecasts, while non-random errors accumulate. Furthermore, investments in more sophisticated forecasting tools may not provide the expected benefits when biases and a weak internal control environment are a key concern in firms.

The analyses in chapter 4 show that brand value estimates of three well-known brand rankings (i.e., Interbrand, Brand Finance, and BrandZ) have no incremental information content to predict cash flows and earnings out-of-sample. A portfolio analysis supports this conclusion.