Prognostisering av räntabilitet på eget kapital - Förbättras möjligheten att prognostisera räntabilitet på eget kapital om hänsyn tas till earnings management
Prior studies have shown that earnings management can be used either to inform or to mislead investors about the future performance of a company. However, few studies have examined the impact of earnings management on forecasting return on equity (ROE). The aim of this thesis is to investigate whether the ability to forecast next year's ROE is improved when taking earnings management, measured as discretionary accruals, into account. This is examined by comparing a forecast model that takes the magnitude of discretionary accruals into consideration with a model that does not. The study is based on companies that were listed on the Stockholm Stock Exchange during 2002-2012. The results demonstrate that a forecast model that takes the level of earnings management into consideration does not provide more accurate predictions of next year's ROE. Therefore, it is not possible to conclude that information about a firm's earnings management is valuable when forecasting ROE.