Understanding the Accrual Anomaly
---- Acknowledgements -----
For helpful comments, we thank Andrew Ang, Sreedhar Bharath, Long Chen, Mozaffar Khan (discussant), Paolo Pasquariello, Amiyatosh Purnanandam, Reuven Lehavy, and seminar participants at Emory University and the 18th Annual Conference on Financial Economics and Accounting at New York University. Lu Zhang acknowledges the financial support provided by the NTT Program of Asian Finance and Economics at the Stephen M. Ross School of Business at the University of Michigan. This manuscript supersedes our previous working paper circulated as "The accrual anomaly: Exploring the optimal investment hypothesis." All remaining errors are our own. The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research.