Abstract
Heaping is a phenomenon in which reported numbers tend to appear in increments that are important for cultural or other reasons. This study reports that heaping is present in monthly earnings reports for publicly listed companies in Taiwan. We find that Taiwanese firms tend to report monthly earnings in increments of 5 in the first two places (digits) of the earnings numbers. Furthermore, we observe predominantly more zeros in the third through fifth places of monthly earnings numbers, suggesting that monthly earnings tend to be reported in increments of 10 in the first three, first four, and first five places. Reporting of monthly earnings in Taiwan is discretionary, and our findings suggest that managers of Taiwanese firms are susceptible to heuristic bias when reporting monthly earnings. These findings complement studies on heaping in U.S. financial markets documenting that managers and financial analysts tend to make earnings per share estimates that heap in increments of nickels.