Using Accounting Information To Forecast Market Performance, 2017 The University of Akron
Using Accounting Information To Forecast Market Performance, Tyler Atanasov
Honors Research Projects
This study examines how accounting information can be used to forecast market performance of stocks. We used the specific accounting information of earnings-to-price and book-to-market value ratios, in relation to a stocks 5-year holding period return to determine market performance. The most current, quarterly data with a longer sample period than previous studies was used. First, portfolios of stocks were formed based on the value of each stocks ratio. Next, univariate tests were then run on each ratio’s portfolios to determine if there was statistical significance in the differences among the portfolios returns. Lastly, we determined that investors could ...
Short-Termism And Corporate Myopia: The Values Assigned By The Market To Short-Term And Long-Term Firms, 2017 Claremont McKenna College
Short-Termism And Corporate Myopia: The Values Assigned By The Market To Short-Term And Long-Term Firms, Justin Alexander
CMC Senior Theses
Short-termism and myopia on the part of corporate managers, analysts, and investors have created a business environment driven by the excessive focus on short-term results and the need to meet earnings targets at the expense of long-term value creation. These are accompanied by numerous consequences, including the potential for short-term-oriented firms, particularly in the U.S., to lag behind global long-term-oriented firms, as well as the potential for short-term mindsets in the corporate world to catalyze financial crises. In this paper, I demonstrate that the market generally assigns higher values to long-term firms rather than short-term ones. This is evidenced ...
Too Big To Fool: Moral Hazard, Bailouts, And Corporate Responsibility, 2017 Duke Law School
Too Big To Fool: Moral Hazard, Bailouts, And Corporate Responsibility, Steven L. Schwarcz
The U.S. and foreign regulatory efforts to prevent another financial crisis have been converging on the idea of trying to end the problem of “too big to fail.” Regulators are concerned that systemically important financial firms will take excessive risks because they will profit by success and expect to be bailed out by government money in case of failure. Unfortunately, the legal solutions being advanced to control this moral hazard tend to be inefficient, ineffective, or even dangerous—such as breaking up firms and limiting their size, which can reduce economies of scale and scope; or restricting central bank ...
Finding The Optimum Point Of Leverage In Real Estate Investment Trusts (Reits), 2016 Loyola Marymount University and Loyola Law School
Finding The Optimum Point Of Leverage In Real Estate Investment Trusts (Reits), Alex B. Stamas
Research & Exhibition
This research expands on the study conducted by Sun, Titman and Twite in 2014 that developed a method of separating pure leverage from the effects of financial conditions by differentiating between debt ratios and maturity structures of debt. Using a broader data set that includes both equity and mortgage REITs and the methodology of Sun, Titman and Twite, this research aims to find the optimum degree of leverage in any set of conditions by examining the amount of pure leverage in equity and mortgage REITs and various market conditions and investment types and ratios. This optimum degree of leverage could ...
Seeing Is Believing: Analysts' Corporate Site Visits, 2016 Singapore Management University
Seeing Is Believing: Analysts' Corporate Site Visits, Qiang Cheng, Fei Du, Xin Wang, Yutao Wang
Research Collection School Of Accountancy
This study examines the impact of corporate site visits on analysts’ forecast accuracy based on a sample of such visits to Chinese listed firms during 2009–2012. We find that analysts who conduct visits (“visiting analysts”) have a greater increase in forecast accuracy than other analysts. Consistent with the notion that site visits facilitate analysts’ information acquisition through observing firms’ operations, we find that the results are stronger for manufacturing firms, firms with more tangible assets, and firms with more concentrated business lines. Moreover, we find that the effect of a site visit is greater when the site visit is ...
On The Foundations Of Corporate Social Responsibility, 2016 Singapore Management University
On The Foundations Of Corporate Social Responsibility, Hao Liang, Luc Renneboog
Research Collection Lee Kong Chian School Of Business
A firm’s corporate social responsibility (CSR) practice and its country’s legal origin are strongly correlated. This relation is valid for various CSR ratings coming from several large datasets that comprise more than 23,000 large companies from 114 countries. We find that CSR is more strongly and consistently related to legal origins than to “doing good by doing well”-factors, and most firm and country characteristics such as ownership concentration, political institutions, and degree of globalization. In particular, companies from common law countries have lower level of CSR than companies from civil law countries, and Scandinavian civil law ...
Socially Responsible Firms, 2016 Singapore Management University
Socially Responsible Firms, Allen Ferrell, Hao Liang, Luc Renneboog
Research Collection Lee Kong Chian School Of Business
In the corporate finance tradition, starting with Berle and Means (1932), corporations should generally be run to maximize shareholder value. The agency view of corporate social responsibility (CSR) considers CSR an agency problem and a waste of corporate resources. Given our identification strategy by means of an instrumental variable approach, we find that well-governed firms that suffer less from agency concerns (less cash abundance, positive pay-for-performance, small control wedge, strong minority protection) engage more in CSR. We also find that a positive relation exists between CSR and value and that CSR attenuates the negative relation between managerial entrenchment and value.
Active Intermediation In Overlapping Generations Economies With Production And Unsecured Debt, 2016 Iowa State University
Active Intermediation In Overlapping Generations Economies With Production And Unsecured Debt, Mark Pingle, Leigh Tesfatsion
It is well known that the first welfare theorem fails for the pure exchange^overlapping generations economy studied by Samuelson (1958) and for the private production overlapping generations economy studied by Diamond (1965). Tirole (1985) combines and extends the Samuelson and Diamond frameworks by permitting both unsecured debt and private pro duction and shows that the first welfare theorem stillfails to hold. This paper shows that the reason for this failure is that intermediation is niodelled as a purely passive coordination ac tivity implemented by a Walrasian Auctioneer.
Capital Structure In The Family Firm: Exploring The Relationship Between Financial Sources And Family Dynamics, 2016 Kennesaw State University
Capital Structure In The Family Firm: Exploring The Relationship Between Financial Sources And Family Dynamics, Diego G. Velez
Doctor of Business Administration Dissertations
How a company structures its capital greatly affects its strategic options and its strategic decisions according to contemporary thinking. However, while there is ample literature on how publicly held companies’ capital should be structured, less is known about private companies. Additionally, one or more members of a single family typically own the majority of private companies, and unlike public companies, family dynamics influence these firms’ non-financial and financial goals and strategic decisions. This overlap of family dynamics into the business arena complicates conventional approaches or at least makes conventional approaches more difficult to apply.
This dissertation focuses on privately held ...
Governmental Intervention In An Economic Crisis, 2016 University of Southern California Law
Governmental Intervention In An Economic Crisis, Robert K. Rasmussen, David A. Skeel Jr.
This paper articulates a framework both for assessing the various government bailouts that took place at the onset of Great Recession and for guiding future rescue efforts when they become necessary. The goals for those engineering a bailout should be to be as transparent as possible, to articulate clearly the reason for the intervention, to respect existing priorities among investors, to exercise control only at the top level where such efforts can be seen by the public, and to exit as soon as possible. By these metrics, some of the recent bailouts should be applauded, while others fell short. We ...
Relation Between Auditor Quality And Corporate Tax Aggressiveness: Implications Of Cross-Country Institutional Differences, Kiridaran Kanagaretnam, Kiat Bee Jimmy Lee, Chee Yeow Lim, Gerald J. Lobo
Research Collection School Of Accountancy
Using an international sample of firms from 31 countries, we study the relation between auditor quality and corporate tax aggressiveness. Employing an indicator variable for tax aggressiveness when the firm's corporate tax avoidance measure is within the top quintile of each country-industry combination, we find strong evidence that auditor quality is negatively associated with the likelihood of tax aggressiveness, even after controlling for other institutional determinants such as home-country tax system characteristics. We also find that the negative relation between auditor quality and the likelihood of tax aggressiveness is more pronounced in countries where investor protection is stronger, auditor ...
How Corporate Culture Impacts Unethical Distortion Of Financial Numbers, 2016 University of Dayton
How Corporate Culture Impacts Unethical Distortion Of Financial Numbers, Joseph F. Castellano, Kenneth Y. Rosenzweig, Harper A. Roehm
The recent accounting scandals have highlighted the critical role that investor confidence in the accuracy and lack of distortion of accounting data plays in the health of capital markets and, indeed, the whole economy. The legal and moral culpability of top-level company managers (as well as auditors) is an issue that will be addressed by the nation in the coming months. Whether or not legal sanctions are imposed on managers, it would be well to examine some of the reasons managers may feel compelled to distort accounting numbers as well as engage in other actions that damage the interests of ...
The Abcs Of Communicating Results, 2016 University of Dayton
The Abcs Of Communicating Results, Deborah S. Archambeault, Morgen Rose
Communicating results is an integral part of the internal auditor's job, and The IIA's International Standards for the Professional Practice of Internal Auditing recognizes its importance by specifying in Standard 2420 that communications should be "accurate, objective, clear, concise, constructive, complete, and timely." In its 2009 survey. The Biggest Internal Audit Challenges in the Next Five Years, Protiviti, a global consulting firm, ranked communication with management and the audit committee as one of the biggest challenges facing internal auditing through 2012. Their subsequent 2010 Internal Audit Capabilities and Needs Survey identified presentation skills as the top "need to ...
Standard Costing Variances: Potential Red Flags Of Fraud?, 2016 Texas State University
Standard Costing Variances: Potential Red Flags Of Fraud?, Cecily A. Raiborn, Janet B. Butler, Lucian Zelazny
This article focuses on how standard cost variances can be used in detecting potential fraudulent activities. Each primary type of variance (material, labor, and overhead) is addressed with a discussion of possible inappropriate causal factors. Additionally, internal controls, graphic techniques, and other methods that can be implemented to combat fraud are provided.
Procurement Fraud, 2016 La Salle University
Procurement Fraud, Lisa Mcnamee
Economic Crime Forensics Capstones
The 2016 Global Economic Crime Survey conducted by PricewaterhouseCoopers LLP (2016), states that twenty-two percent of companies have experienced procurement fraud. The statistics have actually decreased since 2014 when twenty-seven percent of companies had experienced procurement fraud. However, procurement fraud is still one of the most costly fraudulent schemes. Despite the reduction, the Department of Defense continues to experience large procurement fraud cases, both in number and dollar value. A recent example is the Supreme Foodservice fraud case, which cost the Defense Logistics Agency $757 million dollars in fraudulent charges. (Jahner, 2014) The Department of Defense Office of Inspector General ...
Regulation Fd: An Alternative Approach To Addressing Information Asymmetry, 2016 University of Pennsylvania Law School
Regulation Fd: An Alternative Approach To Addressing Information Asymmetry, Jill E. Fisch
This chapter traces the development of the SEC’s use of Regulation Fair Disclosure (FD) to address information asymmetry in the securities markets. The chapter describes the SEC’s developing enforcement policy and notes, in particular, the SEC’s efforts, through its selection and settlement of Regulation FD cases, to provide guidance to corporations and corporate officials about areas of key concern. The chapter concludes by highlighting current areas of particular importance, including disclosure of information through private meetings and the implications of technological innovations such as the internet and social media. The chapter is forthcoming in Research Handbook on ...
Vultures Or Vanguards?: The Role Of Litigation In Sovereign Debt Restructuring, 2016 University of Pennsylvania Law School
Vultures Or Vanguards?: The Role Of Litigation In Sovereign Debt Restructuring, Jill E. Fisch, Caroline M. Gentile
No abstract provided.
Top Cop Or Regulatory Flop? The Sec At 75, 2016 University of Pennsylvania Law School
Top Cop Or Regulatory Flop? The Sec At 75, Jill E. Fisch
In their forthcoming article, Redesigning the SEC: Does the Treasury Have a Better Idea?, Professors John C. Coffee, Jr., and Hillary Sale offer compelling reasons to rethink the SEC’s role. This article extends that analysis, evaluating the SEC’s responsibility for the current financial crisis and its potential future role in regulation of the capital markets. In particular, the article identifies critical failures in the SEC’s performance in its core competencies of enforcement, financial transparency, and investor protection. The article argues that these failures are not the result, as suggested by the Treasury Department Blueprint, of a balkanized ...
The Mess At Morgan: Risk, Incentives And Shareholder Empowerment, 2016 University of Pennsylvania Law School
The Mess At Morgan: Risk, Incentives And Shareholder Empowerment, Jill E. Fisch
The financial crisis of 2008 focused increasing attention on corporate America and, in particular, the risk-taking behavior of large financial institutions. A growing appreciation of the “public” nature of the corporation resulted in a substantial number of high profile enforcement actions. In addition, demands for greater accountability led policymakers to attempt to harness the corporation’s internal decision-making structure, in the name of improved corporate governance, to further the interest of non-shareholder stakeholders. Dodd-Frank’s advisory vote on executive compensation is an example.
This essay argues that the effort to employ shareholders as agents of public values and, thereby, to ...
From Legitimacy To Logic: Reconstructing Proxy Regulation, 2016 University of Pennsylvania Law School
From Legitimacy To Logic: Reconstructing Proxy Regulation, Jill E. Fisch
No abstract provided.