-
作者：Blum, Emily S.; Hatfield, Richard C.; Houston, Richard W.
作者单位：Texas A&M University System; Texas A&M University College Station; University of Alabama System; University of Alabama Tuscaloosa
摘要：Auditors often face situations in which acting on their professional obligations comes with potential personal costs. Drawing upon the Theory of Reputation in Organizations, we predict that perceived costs associated with these actions are lower for auditors with positive reputations, which, in turn, influences their actions. In our first experiment, participants perceive that auditors with negative reputations face a more constrained choice set when anticipating a budget overage. Further, par...
-
作者：Lillis, Anne M.; Malina, Mary A.; Mundy, Julia
作者单位：University of Melbourne; University of Colorado System; University of Colorado Denver; University of Greenwich
摘要：We examine how subjectivity in performance measurement and reward systems (PMRS) is used to mitigate incentive contracting risks. Drawing on data from 38 interviews with supervisory and subordinate managers in four firms, we provide a more comprehensive explanation of the role of subjectivity in risk mitigation than is evident in the prior literature. We provide empirical evidence of the importance firms place on the use of subjectivity to mitigate the risk of incentive misalignment and employ...
-
作者：Chen, Shuping; Miao, Bin; Valentine, Kristen
作者单位：University of Texas System; University of Texas Austin; The Chinese University of Hong Kong, Shenzhen; University System of Georgia; University of Georgia
摘要：We examine the voluntary disclosure behavior of peer firms of hostile takeover targets. We find that peer firms under control threat use a disclosure strategy that emphasizes bad news: they provide more bad news forecasts, tend to bundle bad news forecasts with earnings announcements, use more negative tone in conference call presentations, and more evenly distribute negative tonal words throughout the presentation to heighten the visibility of bad news. This asymmetric disclosure of bad news ...
-
作者：Laux, Volker
作者单位：University of Texas System; University of Texas Austin
摘要：This paper studies the effects of allocating control rights to lenders via debt covenants when managers can sometimes misreport the accounting information on which the covenants are based. When contract renegotiation is exogenously prohibited, including a covenant in the contract is ex ante optimal because it increases both the probability that poor projects are liquidated and the manager's effort incentive. When the parties can renegotiate the contract, the results can flip: granting the lend...
-
作者：Schwab, Casey M.; Stomberg, Bridget; Williams, Brian M.
作者单位：University of North Texas System; University of North Texas Denton; Indiana University System; IU Kelley School of Business; Indiana University Bloomington
摘要：We use data envelopment analysis (DEA) to develop a measure of effective tax planning that is theoretically aligned with the Scholes-Wolfson paradigm and captures how efficiently firms maximize after-tax returns given their operating, investing, and financing decisions. We then (1) document that the measure is associated with higher after-tax returns to provide assurance DEA achieves its objective in our setting, (2) demonstrate that the measure is incremental to cash ETRs in predicting after-...
-
作者：Lee, Charles M. C.; Zhu, Christina
作者单位：Stanford University; University of Pennsylvania
摘要：We use trade-level data to examine the role of actively managed funds (AMFs) in earnings news dissemination. We find that AMFs are drawn to, and participate disproportionately more in, earnings announcements (EAs) that include bundled managerial guidance. When the two pieces of news are directionally inconsistent, AMFs trade in the direction of future guidance rather than current earnings. AMFs exhibit an ability to discern, and adapt their trading to, the bias in bundled guidance. While AMF t...
-
作者：Christensen, Dane M.; Serafeim, George; Sikochi, Anywhere
作者单位：University of Oregon; Harvard University
摘要：Despite the rising use of environmental, social, and governance (ESG) ratings, there is substantial disagreement across rating agencies regarding what rating to give to individual firms. As what drives this disagreement is unclear, we examine whether a firm's ESG disclosure helps explain some of this disagreement. We predict and find that greater ESG disclosure actually leads to greater ESG rating disagreement. These findings hold using firm fixed effects and using a difference-in-differences ...
