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Articles 1 - 16 of 16
Full-Text Articles in Business
The Importance Of Fairness Perceptions: The Effect Of Icfr Audit Reporting Options And Focus Of Auditor Behavior On Management Defensiveness, Aubrey R. Whitfield
The Importance Of Fairness Perceptions: The Effect Of Icfr Audit Reporting Options And Focus Of Auditor Behavior On Management Defensiveness, Aubrey R. Whitfield
Doctoral Dissertations
Unlike financial statement audits, auditor reporting requirements for audits of internal control over financial reporting (ICFR) prohibit auditors from issuing a qualified opinion (i.e., only unqualified or adverse opinions are permitted). Using an experiment with experienced financial reporting managers, this study explores how managers’ perceptions of the unfairness of the ICFR reporting requirements influence their judgments when audit issues arise. Based on fairness heuristic theory, I predict that managers are more defensive when the auditor is not permitted to issue a qualified opinion on the audit of ICFR (compared to the auditor being able to issue a qualified opinion) due …
Two Essays On Using Data Manipulation To Justify Biased Reports, Cody Lu
Two Essays On Using Data Manipulation To Justify Biased Reports, Cody Lu
Doctoral Dissertations
An important aspect of data-generated metrics is the degree to which they can be manipulated by users. Agents providing reports often (a) have incentive conflicts with principals and (b) have access to and an ability to manipulate data used in those reports. This study investigates how data manipulation affects advisors’ tendency to provide biased recommendations when incentives between advisors and advisees are misaligned and aligned. Drawing on theories in deception and persuasion, I posit that, when incentives are misaligned, advisors will provide a more biased recommendation when the evidence used to support their recommendation is more manipulable. I also predict …
How Does Shareholder Voting Influence Individual Investors’ Investment Decisions?, Yushi Tian
How Does Shareholder Voting Influence Individual Investors’ Investment Decisions?, Yushi Tian
Doctoral Dissertations
Shareholder voting is an important way for investors to participate in corporate governance. In this study, I examine, as individual investors participate in shareholder voting, whether and how their investment decision is affected by the consistency between their own vote and management’s final decision on the voting issue (i.e., opinion consistency) and whether management’ final decision aligns with the majority or minority of investors (i.e., management position). Using ego-defensiveness theory and majority effect, I predict and find that when investors have stronger opinions on the voting issue, they make more positive investment decisions if management’s final decision on the voting …
He Said, She Said: Investor Reactions To Ceo Gender And Earnings Guidance Disclosure In The Presence Of Shareholder Activism, Scott C. Jackson
He Said, She Said: Investor Reactions To Ceo Gender And Earnings Guidance Disclosure In The Presence Of Shareholder Activism, Scott C. Jackson
Doctoral Dissertations
This study addresses concerns from the SEC and examines the trend of shareholder activism and its impact on financial players. Specifically, I examine how the nature of the shareholder activism (Profitability-focused versus Environmental/Social-focused) interacts with CEO gender to create perceptions of match or mismatch within nonprofessional investors, in terms of perceived ability to address the shareholder activism. Drawing on role-congruity theory, I predict and find that when a perceived match exists, investment willingness is increased, with the greatest differences occurring when the CEO does not disclose earnings guidance information. Given recent trends that show increased disclosure of earnings guidance in …
Narrative Feedback In Subjective Performance Evaluations: Do Ratings Change The Narrative?, Kyle Stubbs
Narrative Feedback In Subjective Performance Evaluations: Do Ratings Change The Narrative?, Kyle Stubbs
Doctoral Dissertations
Several high-profile companies are leading the charge to remove subjective performance ratings from their performance management processes leaving only narrative evaluations. Using two experiments, I investigate the effects of the ratings on narrative evaluations supervisors provide. In chapter 1, I test theory on supervisor goal attainment to learn how simultaneously providing a performance rating affects the narrative evaluation supervisors provide to employees. In supervisors’ seeking of honesty and social cost reduction goals, I predicted the favorability of narrative evaluations to depend on the presence of ratings and the purpose of the performance evaluation. I used psychological licensing and process accountability …
The Impact Of Material Weakness Presentation Structure And Internal Control Terminology On Investor Perceptions, Matthew Starliper
The Impact Of Material Weakness Presentation Structure And Internal Control Terminology On Investor Perceptions, Matthew Starliper
Doctoral Dissertations
Management is required to disclose any material weaknesses discovered during its evaluation to prepare the company’s financial statements in their internal control over financial reporting (ICFR) report. Across two experiments, I examine the impact of two presentation characteristics of a material weakness made up of multiple, smaller problems— (1) the structure of the presentation of the material weakness, which is whether the material weakness is identified first, followed by descriptions of its individual parts (Top Down structure) or vice versa (Bottom Up structure) and (2) whether or not the parts of the weakness are labeled with ICFR terminology (“significant deficiencies” …
Examining The Sleeper Effect In Auditors' Evaluations Of Audit Evidence, Jennifer B. Mccallen
Examining The Sleeper Effect In Auditors' Evaluations Of Audit Evidence, Jennifer B. Mccallen
Doctoral Dissertations
Current auditing standards require auditors to consider qualifications of the source (e.g., credibility and competence of management) in assessing the quality (e.g., reliability) of audit evidence, especially in subjective audit areas. However, while auditing standards stress the importance of the evaluation of management, they do not prescribe how auditors should effectively identify and incorporate relevant information about the source into evidence evaluation. Psychology research highlights that credibility is multi-dimensional and, more importantly, competence is context-specific. That is, an expert in one area may lack the necessary knowledge and background in other areas. Recent research in psychology has identified a phenomenon …
When Doing Good Backfires: The Effects Of Corporate Social Responsibility Fit On The Decisions Of Long And Short-Term Investors, Chezham Sealy
When Doing Good Backfires: The Effects Of Corporate Social Responsibility Fit On The Decisions Of Long And Short-Term Investors, Chezham Sealy
Doctoral Dissertations
Investors, analysts, and news outlets have expressed concerns that corporate social responsibility (CSR) has deviated from its original altruistic purpose of improving society to a marketing ploy aimed at managing perceptions of shareholders and improving the bottom line of companies. In this study, I analyze how the fit of a company’s business operations to their CSR activities affects the investment willingness of long and short-term investors. While prior research shows numerous positive outcomes associated with CSR, I predict and find that low fit CSR activities can decrease the investment willingness of long-term investors when companies are involved in controversial “sin” …
Navigating The Auditor-Client Relationship During Sensitive Events: Insight On Audit Firm Practices And An Experimental Study, Mary Dodgson
Navigating The Auditor-Client Relationship During Sensitive Events: Insight On Audit Firm Practices And An Experimental Study, Mary Dodgson
Doctoral Dissertations
Maintaining a positive auditor-client relationship is critical for audit firms, particularly during sensitive events. For instance, audit firms state in transparency reports that they take steps to minimize disruption during audit partner rotations, yet it is unclear what these actions entail or the potential effects of these actions on auditor independence and audit quality. I use multiple methods to provide insight into these practices and their related effects. First, I interview 20 audit partners to learn about the process by which audit firms manage the auditor-client relationship during sensitive partner rotation events. Interviewees describe how audit firms identify appropriate partner …
The Impact Of Forecast Roundness, Forecast Uncertainty, And Managers’ Language On Investors’ Judgments, Jessica Osgood
The Impact Of Forecast Roundness, Forecast Uncertainty, And Managers’ Language On Investors’ Judgments, Jessica Osgood
Doctoral Dissertations
Management forecasts can have varying degrees of roundness, including sharp (e.g., a sales growth forecast of 9.73% or 10.27%), explicitly round (e.g., 10.00%), and rounded (e.g., 10%). Prior archival research indicates investors rely less upon round than sharp forecasts (Bamber, Hui, and Yeung 2010), yet it is unclear why this occurs or how contextual features of earnings forecasts moderate this effect. Moreover, this prior research has not distinguished between the effects of explicitly round versus rounded estimates. I provide evidence that the impact of forecast roundness on willingness to invest depends upon forecast uncertainty. That is, rounded sales forecasts enhance …
Follow The Crowd: How Viral Social Information And Social Identity Increase Investors’ Suboptimal Investing Decisions, Stephen Kuselias
Follow The Crowd: How Viral Social Information And Social Identity Increase Investors’ Suboptimal Investing Decisions, Stephen Kuselias
Doctoral Dissertations
Recently enacted standards have formally allowed organizations to offer equity using the crowdfunding model. The crowdfunding model raises capital over the internet by soliciting relatively small contributions from a relatively large number of people who make up a “crowd” (Mollick 2013). Organizations using equity crowdfunding strive for the spread of viral social information to solicit investments (Belleflamme, Lambert, & Schwienbacher 2014). However, research has not yet explored how virality impacts investor decision making. In this study, I investigate whether viral social information can shift investors away from financial maximization goals, leading them to make suboptimal investing decisions. Social identity theory …
Three Essays On Auditor Liability, Jeffrey Scott Pickerd
Three Essays On Auditor Liability, Jeffrey Scott Pickerd
Doctoral Dissertations
Auditor liability is an important topic of accounting research as auditors respond to a constantly changing financial reporting and regulatory environment. Through three independent essays, I intend to explore how estimate uncertainty, financial statement aggregation, audit quality indicators, a company's investor base, and the size of the alleged misstatement can impact auditor liability both in the courtroom, as determined by jurors, and in out of court settlement, as determined by attorneys. I find that jurors do hold the auditor more likely to be negligent when audit quality indicators suggest the auditors did a poor quality audit. I also find that …
The Effect Of Creative Culture On Aggressive Financial Reporting, Ryan Guggenmos
The Effect Of Creative Culture On Aggressive Financial Reporting, Ryan Guggenmos
Doctoral Dissertations
Chief Executive Officers identify creativity as the leadership competency most desired in business today (IBM 2010). As companies recognize the benefits of creativity and innovation, managers are increasingly looking to build creative cultures within their organizations. However, research in psychology suggests that there may be unintended negative consequences to these attempts. In this study, I predict and find that innovative company culture primes creative thought and, in turn, leads to higher levels of real earnings management (REM) behaviors. Using construal level theories of psychological distance proposed by Trope and Liberman (2010), I design and test both a lower-level and a …
The Effects Of An Auditor’S Communication Mode And Professional Tone On Client Responses To Audit Inquiries, Aaron Saiewitz
The Effects Of An Auditor’S Communication Mode And Professional Tone On Client Responses To Audit Inquiries, Aaron Saiewitz
Doctoral Dissertations
Recent audit research has indicated that junior auditors tend to use e-mail for client inquiries. Additionally, audit firms have expressed concerns regarding the ability of junior auditors to communicate professionally. In this study, I investigate whether receiving an auditor inquiry via e-mail differentially affects client responses as compared to more traditional modes of inquiry and whether those responses are affected by the auditor’s professional tone. In an experiment, experienced business professionals respond to a request for information from an auditor regarding a potential accounting adjustment. I varied the communication mode of the request (e-mail, audio, or visual) and the professional …
An Investigation Into Pcaob Reporting Deficiencies, James Samuel Wainberg
An Investigation Into Pcaob Reporting Deficiencies, James Samuel Wainberg
Open Access Dissertations
The PCAOB inspection reports for large audit firms are primarily anecdotal in nature, providing only a list of deficiencies found without any statistical context (e.g., the inspection sample size). This is problematic when trying to determine the extent of a firm's audit weaknesses. However, simply adding statistical data to the reports, as currently provided in the PCAOB reports of small firms, may not solve the problem. Prior research suggests that statistical data are often ignored or underweighted when anecdotal data are present. This study investigates whether a bias for anecdotal data overwhelms the statistical data as currently presented in small …
Managing Audits To Manage Earnings: The Impact Of Baiting Tactics On An Auditor’S Ability To Uncover Earnings Management Errors, Benjamin Labrie Luippold
Managing Audits To Manage Earnings: The Impact Of Baiting Tactics On An Auditor’S Ability To Uncover Earnings Management Errors, Benjamin Labrie Luippold
Open Access Dissertations
This study examines an aspect of earnings management that I refer to as audit management. I define audit management as a client's strategic use of techniques (e.g., baiting tactics) to prevent auditors from discovering earnings management during the audit. Specifically, I examine whether two baiting tactics, diversionary statements and distracting errors, affect an auditor's ability to uncover an accounting error used to manage earnings. Auditors performed analytical review on financial statements that contained an earnings management error (i.e., an intentional error that results in the client meeting an earnings target). I manipulated whether management provided a diversionary statement that explicitly …