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作者：Bizjak, John M.; Kalpathy, Swaminathan L.; Mihov, Vassil T.
作者单位：Texas Christian University
摘要：We find that firms that grant performance-contingent (p-c) equity awards with accounting-based vesting conditions to their CEOs have lower cost of debt and less restrictive loan terms. The benefits of p-c accounting-based awards on debt financing are greater when the moral hazard problem faced by debtholders is potentially more significant-for example, for firms with poorer credit ratings and lower asset tangibility. We find some evidence that certain types of p-c equity awards with stock pric...
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作者：Naughton, James P.; Rusticus, Tjomme O.; Wang, Clare; Yeung, Ira
作者单位：Northwestern University; University of Minnesota System; University of Minnesota Twin Cities; University of Iowa; University of British Columbia
摘要：We examine the causal effect of expected private litigation costs on voluntary disclosure using a natural experiment, the Supreme Court ruling in Morrison v. National Australia Bank. Even though this ruling had no effect on what constituted fraudulent conduct for the purpose of securities litigation, it significantly reduced the expected private litigation costs for foreign cross-listed firms by reducing the pool of potential claimants. It did so by eliminating the right of shareholders who pu...
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作者：Gao, Pingyang; Zhang, Gaoqing
作者单位：University of Chicago; University of Minnesota System; University of Minnesota Twin Cities
摘要：We propose a model to study how auditing standards affect audit quality. We posit that both auditors' incentives and expertise are relevant for audit effectiveness. Auditing standards are useful in mitigating the auditors' possible misalignment of interest with investors. However, auditing standards also restrict auditors' exercise of professional judgment, which, in turn, leads to compliance mentality and reduces auditors' incentives to become competent in the first place. We identify the con...
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作者：Li, Meng
作者单位：University of Texas System; University of Texas Dallas
摘要：This paper studies, both theoretically and empirically, how subordinates to CEOs can discipline the CEOs' self-serving activities. I predict that because CEOs' self-serving activities hurt the subordinates through the subordinates' stakes in the firms, the subordinates who observe these activities will take actions that negatively affect the CEOs, and that in anticipation of such reactions by subordinates, the CEOs will limit their own misbehaviors. This disciplinary mechanism will become more...
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作者：Bentley, Jeremiah W.
作者单位：University of Massachusetts System; University of Massachusetts Amherst
摘要：Prior research finds that agents who are compensated on an imperfect measure of performance tend to distort their operational decisions and believe that the measure is more reflective of reality than it actually is (i. e., they surrogate). I find that agents distort decisions less and surrogate less when they can provide unverifiable narrative explanations for their actions. In my experiment, experienced chess players place bets on and write explanations about in-progress chess games. I manipu...
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作者：Commerford, Benjamin P.; Hatfield, Richard C.; Houston, Richard W.
作者单位：University of Kentucky; University of Alabama System; University of Alabama Tuscaloosa
摘要：Recent research reveals that accruals-based earnings management (AEM) is decreasing while real earnings management (REM) is increasing, suggesting the correlation is due to regulatory scrutiny. However, based on Correspondent Inference Theory, we predict and find that when management uses REM, auditors are more restrictive of management's subjective estimates, making it more difficult for management to use income-increasing AEM. Our experiment manipulates the presence versus absence of REM, an...
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作者：Akins, Brian
作者单位：Rice University
摘要：This study finds that better reporting quality is associated with less uncertainty about credit risk as captured by disagreement among the credit rating agencies. The results also show that reporting quality is more important in reducing uncertainty when debt market participants have less access to private information. To mitigate endogeneity concerns, I use the quasi-natural experiment induced by a change in accounting standards that improved reporting quality. Implementation of the standard ...
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作者：He, Xianjie; Kothari, S. P.; Xiao, Tusheng; Zuo, Luo
作者单位：Shanghai University of Finance & Economics; Massachusetts Institute of Technology (MIT); Central University of Finance & Economics; Cornell University
摘要：We find that economic conditions at the time an auditor enters the labor market have a long-term impact on her judgment and decision making. Specifically, engagement partners who started their career during economic downturns issue audit adjustments more frequently. For the subsample of company-years with no audit adjustments, downturn auditors are more likely to issue a modified audit opinion. In addition, companies audited by downturn auditors are less likely to violate financial reporting a...
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作者：Bills, Kenneth L.; Hayne, Christie; Stein, Sarah E.
作者单位：University of Arkansas System; University of Arkansas Fayetteville; University of Illinois System; University of Illinois Urbana-Champaign; Virginia Polytechnic Institute & State University
摘要：Small accounting firms represent important participants in the audit market, yet details of how they operate and develop competencies remain unexplored. Small firms often join forces through accounting associations and networks (AANs), which may help them overcome significant challenges commonly faced by smaller firms. We interview 37 partners from 18 firms representing nine AANs to examine how small firms leverage their AAN membership and to understand the related implications for audit quali...
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作者：Khan, Urooj; Li, Bin; Rajgopal, Shivaram; Venkatachalam, Mohan
作者单位：Columbia University; University of Texas System; University of Texas Dallas; Duke University
摘要：We examine the cost-effectiveness, from the shareholders' perspective, of the accounting standards issued by the FASB during 1973-2009. We evaluate (1) the stock market reactions of firms affected by the standards surrounding events that changed the standard's probability of issuance; and (2) whether the market reactions are related, in the cross-section, to agency problems, information asymmetry, proprietary costs, contracting costs, and changes in estimation risk. The average standard is a n...
