The Predictive Ability of Fair Values for Future Financial Performance of Commercial Banks and the Relation of Predictive Ability to Banks' Share Prices


  • Accepted by Katherine Schipper. We sincerely appreciate the comments of Urooj Khan, Tom Linsmeier, Laureen Maines, Steve Salterio, Katherine Schipper, Phil Shane, Wayne Thomas, brownbag-presentation participants at Indiana University, session participants at a 2010 Financial Accounting Standards Research Initiative Roundtable, the 2010 Financial Economics and Accounting Conference, and the 2011 Financial Accounting and Reporting section Midyear Meeting, workshop participants at Washington University in St. Louis and two anonymous reviewers. We also gratefully acknowledge the funding provided by the PricewaterhouseCoopers Corporate Governance Grant and the summer support provided by the Kelley School of Business. Professor Hodder and Professor Hopkins thank Ernst and Young and the Deloitte Foundation, respectively, for their financial support.