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- External counsel (2)
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Articles 1 - 5 of 5
Full-Text Articles in Business
The Sec Revolving Door And Comment Letters, Michael Shen, Samuel T. Tan
The Sec Revolving Door And Comment Letters, Michael Shen, Samuel T. Tan
Research Collection School Of Accountancy
Government officials, advocacy groups, and the business press have raised concerns that former SEC employees may continue to influence the SEC after leaving the agency. Using hand-collected data on the characteristics of 1,384 lawyers who represented firms in responding to SEC comment letters between 2005 and 2016, we examine the impact of post-revolving SEC employees on the SEC comment letter process. Among other determinants, we find that older and larger firms with a history of litigation are more likely to hire former SEC lawyers over non-SEC lawyers. Relative to firms that involve only non-SEC lawyers, we find that firms that …
Shareholder Litigation And Corporate Disclosure: Evidence From Derivative Lawsuits, Thomas Bourveau, Yun Lou, Rencheng Wang
Shareholder Litigation And Corporate Disclosure: Evidence From Derivative Lawsuits, Thomas Bourveau, Yun Lou, Rencheng Wang
Research Collection School Of Accountancy
Using the staggered adoption of universal demand (UD) laws in the United States, we study the effect of shareholder litigation risk on corporate disclosure. We find that disclosure significantly increases after UD laws make it more difficult to file derivative lawsuits. Specifically, firms issue more earnings forecasts and voluntary 8-K filings, and increase the length of management discussion and analysis (MD&A) in their 10-K filings. We further assess the direct and indirect channels through which UD laws affect firms' disclosure policies. We find that the effect of UD laws on corporate disclosure is driven by firms facing relatively higher ex …
Accounting Choices And The Legal Environment: The Impact Of The Ex Post Loss Rule, Teck Meng Junior Tan
Accounting Choices And The Legal Environment: The Impact Of The Ex Post Loss Rule, Teck Meng Junior Tan
Research Collection School Of Accountancy
Using a landmark Supreme Court decision as a natural experiment, I examine the impact of a fundamental requirement in securities litigation, the ex post loss rule, on income-decreasing accounting choices. Dura Pharmaceuticals v. Broudo (2005) established that plaintiffs must show that the alleged misrepresentations caused an actual economic loss. The case resolved a circuit split, allowing me to identify a treatment jurisdiction affected by Dura, and control jurisdictions in which the rule was already the prevailing legal standard. Motivated by legal analyses suggesting that Dura incentivizes firms to delay negative corrections, I hypothesize and find that treatment firms in high-litigation …
Individual Lawyers, The Sec Revolving Door, And Comment Letters, Michael Shen, Samuel T. Tan
Individual Lawyers, The Sec Revolving Door, And Comment Letters, Michael Shen, Samuel T. Tan
Research Collection School Of Accountancy
Government officials, advocacy groups, and the business press have raised concerns that former SEC employees may continue to influence the SEC after leaving the agency. Using a hand-collected database of individual lawyers that represent firms in responding to SEC comment letters, we examine the impact of individual lawyers, and lawyers formerly employed by the SEC, on the comment letter process. We document significant differences between lawyers and law firms in their clients’ resistance to SEC comment letters, and find that firms that retain former SEC employees are larger, more profitable, and more likely to have received a comment letter raising …
How Do Accounting Practices Spread? An Examination Of Law Firm Networks And Stock Option Backdating, Teck Meng Junior Tan, Patricia M. Dechow
How Do Accounting Practices Spread? An Examination Of Law Firm Networks And Stock Option Backdating, Teck Meng Junior Tan, Patricia M. Dechow
Research Collection School Of Accountancy
We hypothesize that one way that accounting practices spread is through law firm connections. We investigate this prediction by examining companies that avoided reporting compensation expense by engaging in stock option backdating. We hypothesize that executives engaged in backdating because they were desensitized to its inappropriateness when they learned through their legal counsel that other companies were engaging in this practice. We identify backdating companies through backdating-related restatements of earnings. Using network analysis, we document that backdating companies are more highly connected with other backdating companies via shared law firms. Logistic regressions indicate that the odds of a company backdating …