Accounting Commons^™

Essays On Tax Impacts On Corporate Finance, Corporate Governance And Regional Disparity, Mei Li

Dissertations, Theses, and Capstone Projects

This dissertation consists of three chapters that cover topics on tax impacts on corporate finance, regional disparity and corporate governance.

Chapter 1 - How Do Net Operating Loss Carryforwards Affect Tax Impact on Corporate Capital Structure? This paper examines the impact of net operating loss (NOL) carryforwards on the tax implications of corporate capital structure. Leveraging the Tax Cuts and Jobs Act of 2017 (TCJA), the largest tax reform in four decades, this paper investigates the effect of NOL carryforwards on firms' sensitivity to tax reforms. As NOL carryforwards have become increasingly significant since 2000, but not widely researched due …

Firm Transparency Of Risk Oversight: An Examination Of Cybersecurity Governance Disclosures, Laurie E. Ereddia

Doctoral Dissertations

In this study, I examine factors associated with firm transparency of board oversight using the setting of cybersecurity risk. The SEC requires that, to the extent cybersecurity risks are material, firms must disclose the nature of the board’s role in overseeing the management of that risk, allowing investors to assess how the board is fulfilling its risk oversight duties. Using textual analysis, I identify 2,921 firms that report material cybersecurity risk factors in their annual reports. From these firms’ 2021 proxy statement filings, I hand collect data relating to 12 different elements of cybersecurity board oversight and create an overall …

Esg Scores As A Measure Of Risk: The Relationship Between Environmental, Social, And Corporate Governance Ratings And The Financial Performance Of U.S. Oil And Gas Companies, Lauren Kim

Scripps Senior Theses

This study investigates the association between ESG (environmental, social, corporate governance) scores on the financial performance of U.S. oil and gas companies, an industry facing significant ESG-related pressures. ESG scores evaluate a firm’s environmental impacts, social responsibility, and corporate governance practices and can be used as a form of evaluating a firm’s risk mitigation efforts. However, there is not sufficient evidence to conclude that there exists a relationship, positive or negative, between ESG scores and firm performance in this industry. Overall, the findings of this study highlight the growing interest in ESG investing and is useful for investors and firms …

Dual-Class Share Structure And Innovation, Lindsay Baran, Arno Forst, M. Tony Via

School of Accountancy Faculty Publications and Presentations

Using a sample of dual-class firms matched with single-class firms possessing similar antitakeover protection, we find a positive association between disproportionate insider control and patent output, quality, creativity, research and development efficiency, and chief executive officer innovative risk taking. We also find, however, that the positive effects of disproportionate control on innovation are concentrated in financially constrained firms and firms in highly competitive industries, and that the positive effects dissipate within 10 years after the initial public offering. Most important, the positive effect of dual-class structures for innovation is conditional on the presence of innovative insiders in the firm. These …

Biodiversity Disclosure Of Indonesian Companies And The Role Of The Board Of Commissioners, Ahmad Hambali, Desi Adhariani

Jurnal Akuntansi dan Keuangan Indonesia

The environmental damage that occurs on a large scale has an impact on reducing biodiversity. Biodiversity has an important role that is useful for human life and plays a central role in economic development. This condition makes various parties aware of their role in preventing further damage. Companies, whether directly or indirectly, owe a great deal to the environment. This study seeks to examine the role of the Board of Commissioners as proxied by the size of the Board of Commissioners, the proportion of Independent Boards, and the proportion of women on the Board of Commissioners as a corporate governance …

Theranos: Case Study And Examination Of The Fraud Triangle, Abbey Jennings

Finance Undergraduate Honors Theses

Fraud is a serious issue which carries significant implications. Fraud committed by top level managers is particularly grievous, as it ripples through a firm, harming the company’s shareholders, employees, and credibility, while posing a threat to individuals and society (Zahra, et al.). A common framework in auditing, the fraud triangle, outlines three factors that if present, increase the risk or enable fraud to occur. The three factors are incentive, opportunity, and rationalization to commit fraud (Barlow).

In 2018, the Securities and Exchange Commission (SEC) charged Elizabeth Holmes, founder and CEO of a supposedly groundbreaking health tech company, Theranos, with what …

Audit Committee Effectiveness And Company Performance: Evidence From Egypt, Engy Elhawary

Business Administration

The purpose of this paper is to investigate the impact of audit committee characteristics (size, independence, experience, gender diversity, and frequency of meetings) on the company‘s financial performance (ROA and ROE) in Egypt. In 2016, the Egyptian Stock Exchange announced a new listing requirement for the audit committee members‘ characteristics to enhance its effectiveness. Data are gathered from the board of directors (BOD) and annual reports of the EGX 30 index non-financial listed companies in Egypt for the period of 2016–2018. Data is analyzed by using panel data cross-section data analysis and correlation analysis. The findings reveal that the audit …

The Role Of Leadership On Corporate Governance, John Brackett

Doctoral Dissertations and Projects

Corporate governance and internal controls over the accounting and financial reporting processes are critical to timely and accurate financial data reporting. Sheikh (2019) concluded that internal controls establish accepted practices, manage risk choices in decision-making, and improve ongoing monitoring activities to ensure compliance with laws, regulations, and company policy. Wang and Zhou (2016) identified leadership as a critical component of corporate governance and concluded that a company’s accounting process and related controls were interdependent with enterprise management and directly correlated to the sustainability of operations and business success. The Board of Directors and the Chief Audit Executives are responsible for …

Reversing The Fortunes Of Active Funds, Adi Libson, Gideon Parchomovsky

All Faculty Scholarship

In 2019, for the first time in the history of U.S. capital markets, passive funds surpassed active funds in terms of total assets under management. The continuous growth of passive funds at the expense of active funds is a genuine cause for concern. Active funds monitor the management and partake of decision-making in their portfolio companies. Furthermore, they improve price efficiency and managerial performance by engaging in informed trading. The buy/sell decisions of active funds provide other market participants reliable information about the quality of firms. The cost of active investing is significant and it is exclusively borne by active …

Mapping The Knowledge Of Islamic Accounting Studies On Shariah Audit: A Bibliometric Analysis, Luqman Hakim Handoko, Sepky Mardian

Library Philosophy and Practice (e-journal)

The issues of shariah audit appeared more than three decades ago along with the progress of the Islamic financial industries. But it is challenging to obtain a study explaining the current state of shariah audit research to date. Therefore, it is necessary to assess the research on the Shariah audit. Thus, this study aimed to analyze and visualize the current state of shariah audit using a bibliometric approach. The bibliometric analysis was conducted by using VOSviewer software. To fulfill this goal, the keywords such as shariah audit, shariah auditing, and its variations were searched from the Scopus database. The articles …

Contracting And Reporting Conservatism Around A Change In Fiduciary Duties, Daniel Bens, Sterling Huang, Liang Tan, Wan Wongsumwai

Research Collection School Of Accountancy

We exploit an influential 1991 Delaware court ruling to examine the impact of changes in managerial fiduciary duties on firms’ accounting and contracting choices. The ruling expanded directors’ fiduciary duties in favor of creditors and away from shareholders for a specific group of firms. Using a hand-collected sample of debt contracts around the ruling date, we find that, following the ruling, debt contracts of affected firms rely less on the use of income escalators (provisions in loan contracts which require changes in net worth to reflect losses in full, but only partially for gains and profits) and other conservative adjustments …

Does Litigation Deter Or Encourage Real Earnings Management, Sterling Huang, Sugata Roychowdhury, Ewa Sletten

Research Collection School Of Accountancy

In this paper, we rely on an exogenous shock to examine the impact of litigation risk on real earnings management (REM). We conduct differences-in-differences tests centered on an unanticipated court ruling that reduced litigation risk for firms headquartered in the Ninth Circuit. REM increases significantly following the ruling for Ninth-Circuit firms relative to other firms, consistent with litigation risk deterring REM. Additional analyses reveal that REM rises more following the ruling when firms issue more optimistic disclosures. The evidence is consistent with litigation deterring REM by constraining managers' ability to issue optimistic and misleading disclosures that can conceal the myopic …

Disproportionate Insider Control And Firm Performance, Barry Hettler, Arno Forst

School of Accountancy Faculty Publications and Presentations

The effect of disproportionate insider control on firm performance is ambiguous. Disproportionate control may enhance insiders’ ability to expropriate perquisites; on the other hand, it may provide stability of management and reduce short-term market pressures. Using a hand-collected sample of U.S. dual-class firms, we find that disproportionate control is positively associated with accounting-based performance, but negatively associated with Tobin's Q. These results are consistent with the incentives of entrenched insiders who are interested in profitability but less beholden to capital markets.

Strategies For Improving Profitability Through Effective Internal Controls, Melissa M. Washington

Walden Dissertations and Doctoral Studies

Between 2007 and 2009, the United States experienced a financial crisis. Many businesses experienced difficulties obtaining funds for projects and working capital due to the great recession. As a result, many business owners filed for bankruptcy. The purpose of this multiple case study was to explore strategies that some small business owners in the construction industry used when implementing internal control processes to improve profits. The study population entailed 6 individuals in the southeast region of the United States who successfully implemented internal control processes to improve profits. The data collected were from face-to-face interviews, analysis of company documents, and …

Corporate Governance Strategies To Improve Organizational Performance In The Accounting Industry, Andress Walker

Walden Dissertations and Doctoral Studies

Corporate governance is a leading factor in organizational performance, financial reporting, and stakeholder satisfaction. The purpose of this multiple case study was to explore strategies that senior managers in the accounting industry implement to enforce corporate governance and improve organizational performance. The conceptual framework for the study was stakeholder theory. The population for this study included 3 senior managers of 3 different organizations in the accounting industry located in western United States. Data were collected through semistructured face-to-face interviews and from review of documented corporate governance strategies. The data analysis consisted of the following steps: compiling the data, disassembling the …

Three Essays On Risk Factor Disclosures, Abiodun Isiaka

Theses and Dissertations (Comprehensive)

Beginning in 2005, the US Securities and Exchange Commission (SEC) proposed changes to the disclosure of risk information in the annual 10-K reports. Based on these changes, large firms in the US are required to disclose risk factors in Item 1A of their 10-K. This study contains three essays that review the current literature on Risk Factor Disclosures (RFDs) and employ empirical methods to test the usefulness of this disclosure.

The first essay reviews the existing literature on RFDs and provides direction for future research. This review discusses the strengths and limitations of current research in the field and suggests …

The Relationship Between Corporate Governance And Organizational Performance In Nigerian Companies, Toyin Ishola Lasisi

Walden Dissertations and Doctoral Studies

The growing lack of confidence in public companies arises from the recent accounting scandals and corporate collapses, which have been attributed to the consequences of separation of ownership and control in modern firms. Agency theory predicts a conflict of interest between managers and shareholders that leads to agency costs and weak performance. This study used agency, stakeholders', and stewardship theories as the theoretical framework and multiple regression analysis to examine the relationship between corporate governance mechanisms and organizational performance in nonfinancial firms listed on the Nigerian Stock Exchange. The results of the study could help clarify understanding of corporate governance …

People Centric Governance Model: Conceptualizing The Pillars Of Significance, Zaleha Othman, Rob Melville

The Qualitative Report

This article explores corporate governance issue from the perspective of peoples’ governance. Using qualitative research approach, specifically, a grounded theory method, the paper explores the role of the pillar of significance in corporate governance practices. Interview was used as primary data, although document was also analysed. Analysis of the data revealed people centric governance is essential. Findings suggest that there are several pillar of significance in the corporations that provide strength to the corporate governance practices. Emerging theory suggests that the core of corporate governance lies on the people rather that the structure. The finding is useful as it impacted …

An Examination Of The Use Of The Board Balanced Scorecard By Large Public Corporations, Qianhua Ling, Don Giacomino, Michael Browne, Michael D. Akers

Michael D. Akers

While the Balanced Scorecard (BSC) developed by Norton and Kaplan has gained global prominence as a management tool and there is qualitative accounting literature that discusses the benefits of the Board BSC, there is limited empirical evidence that examines the use of the Board BSC. We surveyed Chairs of large public companies to determine the extent to which they use the Board BSC and the reasons why. Our findings suggest that the Board BSC is currently not a widely used technique by Boards of Directors. We also found that the Sarbanes-Oxley Act of 2002 wasn't an influencing factor for those …

Revisiting Financial (Accounting) Literacy: A Comparison Of Audit Committee Members And Business Students, Don Giacomino, Joseph Wall, Michael D. Akers

Michael D. Akers

While financial literacy is important for an audit committee in discharging its duties there is no authoritative guidance or definition and limited empirical research as to what constitutes financial literacy of audit committees and business students. Coates et al. conducted a study that examined the financial literacy of corporate board members and MBA students at the University of Chicago using an instrument developed by Schipper and WeiL Their findings suggest that both groups lack the appropriate level of financial literacy. This paper extends that research by using the same instrument to examine the financial literacy of undergraduate accounting finance students …

Three Essays On Auditor Industry Specialization, Ankita Singhvi

Open Access Theses & Dissertations

This Dissertation consists of three separate but related essays examining auditor changes, auditor industry specialization and audit fee premiums.

The first essay investigates whether audit committee characteristics affect the types of auditor changes from an industry specialist auditor to a non-industry specialist auditor or the reverse. I examine whether selection of an external auditor is affected by audit committee characteristics such as: 1) number of meetings, 2) number of members on the audit committee, 3) proportion of auditing experts and, 4) proportion of financial experts. The findings show that a greater proportion of auditing experts on the audit committee positively …

Good Corporate Governance: The Role Of The Accountant, Professor Ben C Osisioma

Prof Ben Chuka Osisioma

Corporate governance deals with the mechanism by which stakeholders of a company exercise control over corporate managers and provide overall direction to the firm, such that stakeholders’ interests are protected. In such a situation, the firm operates more responsibly and profitably, relations are enhanced between the firm and all stakeholders - shareholders, policyholders, employees, suppliers and society at large - the quality of executive and non-executive directors is improved, the firm thinks long-term, information needs of all stakeholders are satisfied, and executive management is monitored properly in the interest of shareholders. The role of the accountant in this setting, is …

Busy Boards, Cash Holdings And Corporate Liquidity: Evidence From Uk Panel Data, Valentina Tarkovska

Conference papers

This study examines the effect of board busyness on corporate cash holdings. We offer new insights by evaluating two conflicting views regarding the quality of service that busy directors provide to corporate boards and their impact on decision making. One view is that directors who simultaneously serve on multiple boards improve board decision making ability as they have better experience and bu siness connections (reputational effect).The opposite view is that directors with multiple seats are “too busy to mind the business”, which creates serious agency problems and leads into suboptimal corporate decisions(busyness effect). We analyse a large sample of UK …

Determinants Of Financial Restatement : Does The Ceo-Board Relationship And Ceo Compensation Influence The Risk Of Financial Restatement?, Kimberly A.M. Melinsky

Legacy Theses & Dissertations (2009 - 2024)

The cataclysmic business failures of the past decade clearly outline the necessity for effective governance research and policy. These failures have prompted prominent investors, politicians, and researchers to show an ever-increasing interest in corporate fraudulent activity and its relationship to executive compensation packages and the CEO-board relationship. Further research is needed to better understand these relationships, especially the relationship between governance mechanisms and their influence on financial restatement, an outcome of fraud. This study looks to answer that need by examining the CEO-board relationship, as well as CEO compensation components, the combined effects of CEO compensation and CEO-board relationship variables, …

Does Corporate Governance Influence Misstatement Disclosure Timeliness?, Rapheal Joseph Hamilton

Business Administration - Dissertations

The relationship between corporate governance and firm disclosure for firms in crisis, specifically firms in violation of GAAP, may differ from the relationship demonstrated in prior literature between governance and voluntary disclosure. An emerging stream of disclosure literature assumes that the relationship between corporate governance and misstatement disclosure choices mirror that found in prior voluntary disclosure literature though no study has empirically demonstrated that a similar relationship exists. Using a sample of 302 accounting irregularities disclosed between 2000 and 2006, I investigate the role of corporate governance, including both internal and external mechanisms, in influencing misstatement disclosure timeliness. I provide …

Threats Escalate: Corporate Information Technology Governance Under Fire, Lawrence J. Trautman

Lawrence J. Trautman Sr.

In a previous publication The Board’s Responsibility for Information Technology Governance, (with Kara Altenbaumer-Price) we examined: The IT Governance Institute’s Executive Summary and Framework for Control Objectives for Information and Related Technology 4.1 (COBIT®); reviewed the Weill and Ross Corporate and Key Asset Governance Framework; and observed “that in a survey of audit executives and board members, 58 percent believed that their corporate employees had little to no understanding of how to assess risk.” We further described the new SEC rules on risk management; Congressional action on cyber security; legal basis for director’s duties and responsibilities relative to IT governance; …

Il Comitato Per Il Controllo Interno E Per La Revisione Contabile Introdotto Dall’Art. 19 Del D.Lgs. 39/2010: Riflessioni In Sede Di Prima Istituzione Alla Luce Delle Indicazioni Dell’Unione Europea, Claudio Sottoriva

Claudio Sottoriva

L’esperienza nazionale in tema di costituzione di “comitati” interni all’organo amministrativo si arricchisce, alla luce del D.Lgs. 39/2010, del comitato per il controllo interno e per la revisione contabile ai sensi dell’art. 19 dello stesso. Facendo riferimento alla realtà italiana ed europea in generale si evidenzia la progressiva sperimentazione di formule compositive degli organi amministrativi e di controllo finalizzate ad una loro maggiore specializzazione secondo quanto previsto dai principali codici di autodisciplina (soprattutto avuto riguardo alle società aventi titoli negoziati in mercati regolamentati). Il comitato ex art. 19 del D.Lgs. 39/2010 è previsto per tutti gli enti di interesse nazionale …

Two Essays On Governance In Ipo Firms, Palash Deb

Accounting - Dissertations

In this dissertation we collate a unique hand-collected dataset of 417 IPO firms for the 2001 to 2004 period, and study the effectiveness of governance and signaling mechanisms at an IPO. In chapter 1 our main contention is that current management research on IPOs has primarily looked at how corporate governance variables like board composition and ownership structure affect IPO underpricing, while largely overlooking the implications of these governance structures for long-term liquidity. This is a significant oversight, given the many benefits to IPO issuers from having a liquid stock (e.g., reduced cost of capital, increased external monitoring etc.). We …

Is All Goodwill Created Equal? An Analysis Of The Association Between Agency Conflicts, Board Monitoring, And Goodwill In U.S. Mergers And Acquisitions, Matthew L. Hoag

Doctoral Dissertations

The objective of this study is to examine the association between goodwill and governance structures – specifically, potential agency conflicts and internal and external board monitoring mechanisms – over a four-year period (2004-2007). To do this, I perform two distinct analyses to test (1) whether governance structures appear to be determinants of aggregate goodwill, and (2) whether governance structures appear to moderate investors’ perceptions of aggregate goodwill. I then extend these tests to a sample of U.S. merger and acquisition (M&A) transactions where I calculate a more refined measure of residual goodwill and re-perform the tests using this alternative goodwill …

Revisiting Financial (Accounting) Literacy: A Comparison Of Audit Committee Members And Business Students, Don Giacomino, Joseph Wall, Michael D. Akers

Accounting Faculty Research and Publications

While financial literacy is important for an audit committee in discharging its duties there is no authoritative guidance or definition and limited empirical research as to what constitutes financial literacy of audit committees and business students. Coates et al. conducted a study that examined the financial literacy of corporate board members and MBA students at the University of Chicago using an instrument developed by Schipper and WeiL Their findings suggest that both groups lack the appropriate level of financial literacy. This paper extends that research by using the same instrument to examine the financial literacy of undergraduate accounting finance students …