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Archival References

QuestionAnswer
Kothari (2001) Review of capital markets research in accounting
Ball & Brown (1968) RQ: Any correlation between acct #s and market resturns? A: N/I & EPS predict change in stock price; this is anticipated by market & is reflected before announcment (i.e. interim reports)
Beaver (1968) RQ: Extent to which stockholders perceive information content of acct earnings. Is acct info valuable to investors? A: Investors seem to use the information contained in acct earnings to change their expectations about a security's value
Bernard & Thomas (1989) RQ: What drives the post-earnings announcement drift? A: It is caused by a delayed price response, not by CAPM misspecification. Points away from market efficiency
Sloan (1996) RQ: Nature of info in the accrual & cash flow components of earnings & is all this info reflected in stock prices? A: Investors do not consider all parts of earnings; stock prices do not capture all public info.; cash flows predict future earnings better
Botosan & Plumlee (2002) RQ: Is cost of equity capital correlated w/level&timeliness of disclosure or w/level of inv rel's? A:Cost of equity down w/disclosure in annual report up, up as timeliness incr(more discl = volat up=cost of cap up), no relation w/level of inv relations
Botosan & Plumlee (1997) RQ: Are voluntary discl correlated w/cost of cap? A:Neg. Assoc. btwn cost of equity & discl level; this relationship decreased more if discl from under-researched firm
Hope & Thomas (2008) RQ: Agency costs correlated w/level of geo earnings provided? A: Disclosure (monitoring) down = mgrs more willing expand int'l ops even if leads to lower profit; firm value lower if don't disclose geo earnings; SFAS 131 may reduce ability to monitor mgr
Healy & Palepu (1993) Review of disclosure & transparency
Healy & Palepu (2001) Review of disclosure & transparency
Schipper (2007) Review of disclosure & transparency
Skinner (1994) RQ: Why voluntarily disclose bad news? A: Mgrs more likely preemptively disclose bad bews forecasts on a qrtly basis (vs annual) in order to prevent large stock price declines
Lang & Lundholm (1993) RQ: What factors influence analysts' ratings of a firm's dislosures? A: Higher discl rating for firms: perform well, larger, weaker realtion btwn stock return & earnings, & firms that issue securities. Weak relation btwn return variability & discl score.
Lang & Lunholm (1996) RQ: Is there a relationship between discl practices of firms, # of analysts following a firm, & properties of analysts forecasts? A: Discl incre. investor following, reduce estimation risk & reduce info. assymetry = lower cost of capital
Chen et al. (2010) RQ: Is FRQ assoc w/under & over investment A: FRQ pos assoc w/investment effic. for small firms in emerging mkts. These firms more likely to under-invest. Source of financing & tax enviro. inpact role of acct info & infl FRQ-investment efficiency relatio
Francis et al. (2005) RQ: Do discl decr info assymetry int'lly? A: Int'lly pos assoc btwn firm's need 4 financing & discl level; cost of cap & discl level neg rel. Cost of equity & discl level neg related, but no consistent sig 4 cost of debt
Lang et al. (2010) RQ: Int'lly is there a relation btwn firm-level transparency, stock market liquidity, & valuation? A: Transp down = trans cost up, liquidity down, cost of cap down, and valuation down. Rel stronger in enviro w/greater uncertainty
Jones (1991) RQ: Do firms manage earnings down during import relief investigations? A: Yes. Discretionary accruals are more income drecr during the year ITC completed investigation than would otherwise be expected
Roychowdhury (2006) RQ: Do mgrs use op act to avoid a los or meet/beat analyst forecasts? What factors assoc with real act manip? Develops a model to detect ral act manip. A: Mgrs engage in ral act manip to avoid losses. Industry, existence of debt, growth, etc infl this
Daniel et al. (2008) RQ: Do firms manage earnings up if anticipate earnings w/b lower than exp dividend pmts or dividend thresholds req by debt cov? A: Yes. manage accruals to meet earnings if dividend payer.Rel Stronger post-sox. Cut dividends if don't meet earnings req
Barth et al (2008) RQ: Does implementation of IAS result in higher EQ? A: Yes. Higher EQ for IAS firms than non-IAS firms
Lang et al (2006) RQ: Any diff in EQ btwn domestic US firms & 20-F firms(w/US GAAP) A: US domestic firms higher EQ; cross-listed more earnings mgmt(more if weak local investor protection), less timely loss recognition, lower assoc w/share price=cross listed have lower EQ.
Schipper & Vincent (2003) EQ: earnings of high quality "faithfully represent Hicksian income" Hicksian income: measure a firm's econ inc & is change in s/h equity during a period Representational faithfulness: extent to which acct earnings accurately convey what appear to convey
Hirst et al (2008) Review management forecasts literature
Baginski et al (2002) RQ: Do country diff (US vs Canada) result in diff mgmt forecast behavior? A: Canadaian firms face less-litigious legal envir = more voluntary disclosure (vs US). Canada/less-litigious voluntary info diclosure that less related to earnings decr than US
Rogers & Stocken (2005) RQ: Does mkt know when MEFs are biased & how often are MEFs biased?Any correlation btwn mkt's response & its ability to detect MEF bias? A: Mgr's issue biased MEFs depends on mkt's ability to detect misrep. Mkt predicts MEF bias, depending on the MEF new
Armstrong et al (2010) RQ: What is the market's reaction to EU's adoption of IFRS (event study)? A: EU reaction overall pos. & significant esp for firms with lower pre-adoption info equality. Stronger reaction for banks w/low quality pre-adoption info
Daske et al (2009) RQ: What econ factors assoc w/voluntary adopt IFRS? A: mkt can differentiate serious adopters from "label" adopters. IFRS adoption does not lead to cap mkt benefits unless IFRS reflects commitment to incr transparency
Barth (2000) value relevance
Barth et al (1996) RQ: To waht extent are fair value disclosure under SFAS 107 value relevant A: Disclosed fair value estimates provide significant explanatory power for share prices (i.e. are value relevant)
DeChow et al (1997) Value relevance study
Picconi (2006) RQ: Does mkt fully process all pension info A: No b/c complex info (not lack of info). Mkt fully considers all pension info in earnings but not the valuation impact of disclosure items. The disclosure do predict future returns but not the B/S items
Barth et al (1992) RQ: Does mkt assign different value to diff components of earnings? A: Coeff on various pension costs (required to be separately disclosed under SFAS 87) differ from eachother.
Graham et al. (2005) RQ:Why mgrs earn mgmt & voluntary disclosure?A: mgrs care more about earnings than cash flows;mgrs want to meet benchmarks to incr stock price&own welfare;mgrs want smooth earnings; mgrs willing to sacrifice econ value to manage fin rep perceptions
Ali & Hwang (2000) RQ: do country-specific factors influence value relevance of acct info? A: Yes. VR lower for: bank-oriented countries than investor-oriented; countries with no private std setters; higher book-tax conformity; less on external auditors
Amir (1993) RQ: is info about non-cash post-ret benefits value relevant? A: the present value measure of PRB is VR in addition to the cash pmts disclosed by firms and this occurred as a result of SFAS 106
Glaum (2009) Review pension res.Pension info is VR;recurring pension costs assoc w/stock value,volatile components aren’t; pension cost useful only if persistent & transitory components reported sep;earnings mgmt in pension accts;mkt not fully efficient w/pensions
Van der Stede et al. (2006) Mgmt acct research
Foster & Swenson (1997) Mgmt acct research
Eldenburg et al. (2009)(published AOS) RQ: Does part in ABC sys. Influence resource decisions after implementation? A: Yes leads to actual changes in resource deployment &improved fin perf.If include others in sys devel=change behavior & improve resource allocations.Non-accts crucial 4 success
Eldenburg et al. (2009)(working paper) RQ: Does earnings mgmt occur in non-profit hospitals? A: In non-profit setting real act EM in non-core activities; EM up to achieve pos N/I; EM down to avoid regulatory scrutiny; Real EM has neg effect on future ops; Mgrs respond diff to inc-based comp
Cenker & Nagy (2008) RQ: Do audit firms consider local & national industry spec in retention or dismissing client decisions? A: when national & local specialist less likely resign; when local spec only less likely resign; no relation when national spec only
Lennox (2005) RQ:do affil btwn exec & auditor impair a. qual?A:more clean ops when affil highest when exec hires alma mater than when go to work for a co. that already uses alma mater audit firm; Less exec turnover when affil & receive clean;More exec t/o if unfav op
Chen & Zhou (2007) RQ:Impact of board charac on timing dismissal & successor auditor choice 4 ArthurAnd clients?A:Firms w/more effective audit comm (indep, fin expert, large board, active) & boards resp quickly to Enron-AA sit & more likely to demand higher reputation audit
Engel et al. (2007) RQ: How did SOX change firms' going-private decisions? A: SOX compliance heavy for small firms (more go-private & SOX announcement returns pos related to firm size) & SOX benefits smaller for small firms w/highly concentrated ownership
Zhang (2007) RQ: What is mkt's reaction to SOX & what are private costs of SOX? A: SOX imposes net costs on complying firms; mkt expected SOX to impose net private costson firms by restricting non-audit services & requiring internal control tests
Leuz (2007) Discuss Zhang(2007) &Engel et al(2007). Limitation Zhang: no control group & event window too long w/other events (Iraq) Engel: weak evid SOX resp 4 going-priv decisions (competing hypotheses). Future Res costs of SOX implementation & amendments
Botosan et al. (2009) (working paper) RQ: Do new segment def (under FAS 131) reflect greater relatedness among ops than old (SFAS 14)? A: More faithful rep under SFAS 131
Healy & Palepu (1993)
Healy & Palepu (2001) Acct informative varies w/firm & econ char.Analysts=value.Mkt demand audit. Analysts&auditors=imperfect intermediaries b/c incentive conflicts. Discl is assoc w/stock price, bid-ask spreads, analysts' following, &instit ownership
Blouin et al. (2007) RQ: What are the characteristics of firms' FIN 48 disclosures leading up to & surrounding adoption of FIN 48? A: Diversity in reporting of reserves
Subramaniam & Park (2009) RQ: Does repricing of stock options lower firm risk? A: Yes. Repricing stock options can decr mgrs' preference for excessively risky projects & can induce mgrso undertake less risky investment projects
Myers et al. (2003) RQ: What is the relationship btwn audit tenure & EQ? A: Longer audit tenure = more constraints extreme mgmt decisions. Evidence inconsistent w/claim that EQ down w/long audit tenure (motivation 4 auditor rotation)
Beasley (1996) RQ: Is board of directors composition related to occurrence of f/s fraud? A: Prop of outside directors & prop of indep directors on board infl likelihood of fraud; board composition & director characteristics relate to occurrence of f/s fraud
Hail & Leuz (2006) RQ: What int'l diff infl cost of equity capital?A:Firms from countries w/more discl req., stronger securities reg, & stricter enforcement=lower cost of cap. Infl of legal instit on cost of equity cap insig as cap mkts become more globally integrated
Created by: peggydenise on 2011-05-14



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