%0 Journal Article
%T Can Backward-looking and Forward-looking Information Debias Prospect Effect in Earnings Announcement?
%A Jogianto Hartono
%A Sri Wahyuni
%J -
%D 2017
%R https://doi.org/10.22146/gamaijb.26282 https://doi.org/10.22146/gamaijb.26282
%X This study examines the important issue of whether additional pieces of information about the earnings¡¯ characteristics (their quantitative description and predicted earnings) can debias the prospect effect of the earnings¡¯ announcement. The prospect effect bias can be mitigated by the availability of clear information and an integrated disclosure. Additional information that is included with the previous information will make the investors¡¯ beliefs stronger and it will debias any psychological effects.This research confirms the prospect effect¡¯s bias that investors react more negatively when evaluating a company¡¯s performance after a negative earnings information disclosure rather than react positively in evaluating the performance for a positive earnings information disclosure. The results also show that when additional pieces of information, such as a quantitative description and predicted earnings are added, they can mitigate the prospect effect¡¯s bias. Additional information of predicted earnings as forward-looking oriented information has a stronger debiasing effect than that of additional information of a quantitative description as backward-looking oriented information
%U https://jurnal.ugm.ac.id/gamaijb/article/view/26282