IIM K hosted its First research seminar on May 17, 2024, for the year 2024-25. It was conducted by Prof. Hari Ramasubramanian, Professor of managerial accounting at the Frankfurt School of Finance and Management, Germany.<\/p>\n\n\n\n
The topic was Don t Get to the Point. Overprecision in Management Capital Expenditure Forecasts<\/strong><\/p>\n\n\n\n <\/p>\n\n\n\n <\/p>\n\n\n\n Abstract of the talk given below<\/p>\n\n\n\n Motivated by precision bias theory, which suggests that the value of information decreases as it becomes overly precise, we examine whether capital expenditure forecast precision is associated with forecast accuracy, forecast revision rate, and future operating performance. We \ufb01nd that \ufb01rms issuing point format forecasts issue less accurate forecasts, but that forecast precision is positively associated with accuracy among \ufb01rms issuing range format forecasts. Similarly, forecast revision rate is increasing in forecast precision for range issuers, but is signi\ufb01cantly lower for point issuers. Finally, we \ufb01nd that \ufb01rms issuing range format forecasts have superior future operating performance compared to \ufb01rms issuing point estimates. Our \ufb01ndings support the consensus view that increasingly precise information is associated with positive outcomes, but only within the sample of range forecast issuers. We argue that point estimates are likely an outcome of overprecision, hindering managerial learning and impeding forecast accuracy and future performance.<\/p>\n\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":" IIM K hosted its First research seminar on May 17, 2024, for the year 2024-25. It was conducted by Prof. Hari Ramasubramanian, Professor of managerial accounting at the Frankfurt School of Finance and Management, Germany. The topic was Don t Get to the Point. Overprecision in Management Capital Expenditure Forecasts Abstract of the talk given below Motivated by precision bias …<\/span>Read more »<\/a><\/span><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[110],"tags":[],"class_list":["post-2661","post","type-post","status-publish","format-standard","hentry","category-seminar-2"],"_links":{"self":[{"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=\/wp\/v2\/posts\/2661"}],"collection":[{"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=2661"}],"version-history":[{"count":3,"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=\/wp\/v2\/posts\/2661\/revisions"}],"predecessor-version":[{"id":2668,"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=\/wp\/v2\/posts\/2661\/revisions\/2668"}],"wp:attachment":[{"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=2661"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=2661"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/researchblog.iimk.ac.in\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=2661"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}