The ValueReporting Revolution

Moving Beyond the Earnings Game

Robert G. Eccles, Robert H. Herz, E. Mary Keegan, David M. H. Phillips

Publisher: Wiley, 2001, 347 pages

ISBN: 0-471-39879-9

Keywords: Finance

Last modified: April 5, 2021, 11:26 p.m.

The ValueReporting Revolution: Moving Beyond the Earnings Game

The ValueReporting Revolution is a rallying cry for radical improvements in corporate reporting-a call to be heeded not just by executives who report on corporate performance and the investors who listen to what they say but also by governing boards, accounting firms, securities analysts, and regulators worldwide.

This revolution is about information. To make sound, long-term investment decisions, large institutional investors and astute individuals alike want to know more about what companies actually do to create value. They especially need information about market dynamics, corporate strategy, and nonfinancial value drivers that are leading indicators of a company's future financial performance and stock price.

Yet too many companies today find themselves locked in The Earnings Game. It's a never-ending and highly dysfunctional game focused myopically on short-term earnings, which in reality say very little about future stock price performance. The consequences of the game? Excessive stock price volatility, inaccurate valuations, and over-reliance on market gossip.

Nothing short of a ValueReporting Revolution will end this game and rid the markets of the crippling consequences. This book delivers a trenchant and often biting analysis of the severe problems that plague today's capital markets. More important, it articulates an array of practical, though controversial, solutions.

ValueReporting calls on corporate executives to provide more, rather than less, of the kind of information they use to create value. It exhorts investors to demand that companies do this. It urges boards of directors to make sure it gets done. And it puts accounting firms and securities analysts on notice that they must become part of the solution rather than part of the problem.

Often provocative and never hesitant to tell it like it is, The ValueReporting Revolution speaks with authority and clarity. It sounds its compelling call to arms to anyone with an interest in dramatically improving the markets on which so many depend.

  • Part One: Preparing For The Revolution
    • Prologue: A Manifesto For The Second Revolution
    1. Common Sense
  • Part Two: A Survey Of The Battlefield
    1. Where Has All The Value Gone?
    2. Analyze This
    3. The Earnings Game
    4. The False Prophet Of Earnings
    5. Inside The Exciting World Of Accounting Standards
  • Part Three: Battles That Must Be Won
    1. Out, Out Damned Gap!
    2. Risky Business
    3. There Is No Alternative: The Story Of Shell
  • Part Four; How Sweet It Is
    1. To The Victor Go The Spoils
    2. Can You See Clearly Now?
  • Part Five: Part Of The Solution Or Part Of The Problem?
    1. Get On Board
    2. Standard Setters
    3. Should You See An Analyst?
  • Part Six: Nothing Can Stop Us Now
    1. Send Lawyers, Guns, And Money
    • Epilogue: A Call To Arms


The ValueReporting Revolution

Reviewed by Roland Buresund

Decent ****** (6 out of 10)

Last modified: May 21, 2007, 2:47 a.m.

A very good book, that justifies controllers. It also tries to justify auditors, but fails.


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