Accruals and the prediction of future operating cash-flows: evidence from Tunisian companies

  • Authors

    • Olfa benjemâa ISCCB
    • Mohamed Toukabri
    • Faouzi Jilani
    2014-12-20
    https://doi.org/10.14419/ijaes.v3i1.3867
  • Earnings, Accruals, Operating Cash Flow, Prediction, Future Cash Flow.

  • Abstract

    The purpose of this study is to investigate the ability of earnings and its components to predict future cash flows for Tunisian companies. We provide evidence on the ability of aggregate earnings, accruals and its components to forecast one or two-period ahead cash flows.

    The results of the models show that disaggregating earnings into cash flows and total accruals enhance the predictive ability of earnings relative to aggregate earnings. Furthermore, consistent with prediction, the disaggregating total ac-cruals into its major components (change in accounts receivable; change in inventory; change in accountant’s payable, amortization, and other accruals) significantly enhances the predictive ability of earnings. Each accruals component’s proves a significantly power to predict future cash flows.

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  • How to Cite

    benjemâa, O., Toukabri, M., & Jilani, F. (2014). Accruals and the prediction of future operating cash-flows: evidence from Tunisian companies. International Journal of Accounting and Economics Studies, 3(1), 1-6. https://doi.org/10.14419/ijaes.v3i1.3867

    Received date: 2014-11-18

    Accepted date: 2014-12-15

    Published date: 2014-12-20