The RIM that appears in the accounting literature is a special case of equation (1)
in which the capital and earnings flows are defined in terms of shareholders. This form
of the RIM is equivalent to the Dividend Discount Model (DDM), coupled with what is
known as the Clean Surplus Relation (CSR).^ What results from this coupling is a formula
for the value of the firm at time t, expressed in terms of current book value and
future expected abnormal accounting returns to shareholders: