Prior studies suggest that managers of repurchasing firms use their financial reporting discretion to either reinforce the undervaluation signal (via positive discretionary accruals) or reduce the repurchasing price (via negative discretionary accruals). This study examines whether managers of firms undertaking accelerated share repurchases (ASRs), a recent and important innovation in repurchase methods, use their reporting discretion around the repurchase and if so, what is the motivation behind their reporting behavior. I find that ASR firms report positive discretionary accruals in the quarter of the announcement and that the upward earnings management increases with both the percentage of equity repurchased and CEO’s bonus compensation as a fraction of total compensation. However, there is a negative association between positive discretionary accruals and ASR announcement returns, suggesting that investors perceive positive discretionary accruals as the result of managerial opportunism (i.e., increasing EPS) rather than managerial optimism (i.e., signaling undervaluation). Accordingly, investors discount positive earnings surprises reported in the quarter of and the quarter following the ASR announcement.