Poor Earnings Quality in Foreign Companies Provides Fertile Ground for Short Sellers

Academic evidence has established that opportunistic earnings manipulation is more pervasive and financial statement quality is generally poorer outside the United States. Through an in-depth analysis of internal control weaknesses, accounting policy changes, and working capital, Voyant Global seeks to identify foreign companies that are poised for significant share price underperformance. The combination of an accruals-based quantitative process followed by in-depth accounting policy and working capital analysis routinely highlights deteriorating situations long before they become apparent to the rest of the Street. The universe includes over 4,500 global companies with market capitalizations in excess of $1 billion. The primary markets of focus are the United Kingdom, Germany, France, Sweden, Japan, Hong Kong, China, and India.