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Basic Question 1 of 4
Beneish model can be used to check if:
B. A company's operating cash flow is sustainable.
C. A company's not going to meet its debt obligations.
A. A company is likely to be a manipulator of its earnings.
B. A company's operating cash flow is sustainable.
C. A company's not going to meet its debt obligations.
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Colin Sampaleanu
Learning Outcome Statements
describe the concept of sustainable (persistent) earnings;
describe indicators of earnings quality;
explain mean reversion in earnings and how the accruals component of earnings affects the speed of mean reversion;
CFA® 2026 Level II Curriculum, Volume 2, Module 14.