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2022

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Articles 481 - 489 of 489

Full-Text Articles in Accounting

The Influence Of Management’S Internal Audit Experience On Earnings Management, Matthew Ege, Timothy Seidel, Mikhail Sterin, David A. Wood Jan 2022

The Influence Of Management’S Internal Audit Experience On Earnings Management, Matthew Ege, Timothy Seidel, Mikhail Sterin, David A. Wood

Faculty Publications

We examine whether firms with managers that have prior internal audit experience are less likely to manage earnings. This examination is important because the internal audit function is uniquely positioned to provide experiences that could influence future managerial behavior, including limiting the potential negative repercussions of earnings management. We find that firms with managers that have internal audit experience are associated with lower real earnings management but not accruals-based earnings management. Effects are strongest when managers with internal audit experience have greater power or currently hold financial roles, or when there are a greater number of managers with internal audit …

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Evidence On Internal Audit Quality From Transitioning To Remote Audits Because Of Covid-19, Marc Eulerich, Martin Wagener, David A. Wood Jan 2022

Evidence On Internal Audit Quality From Transitioning To Remote Audits Because Of Covid-19, Marc Eulerich, Martin Wagener, David A. Wood

Faculty Publications

As in-person audits were banned by governments and by company policies due to the COVID-19 pandemic, internal auditors had to transition to remote audits to perform their work. Based on survey responses of internal auditors who have conducted both remote and in-person audits, we find that internal auditors perceive no difference in the efficiency and effectiveness of and stakeholders’ reliance on results from remote and in-person audits when considering all responses. However, we also find that perceived efficiency and effectiveness increase the more experience internal auditors have with remote audits. Supplemental analyses show that support from the auditee, but not …

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Brokerage Relationships And Analyst Forecasts: Evidence From The Protocol For Broker Recruiting, Braiden Coleman, Michael S. Drake, Joseph Pacelli, Brady Twedt Jan 2022

Brokerage Relationships And Analyst Forecasts: Evidence From The Protocol For Broker Recruiting, Braiden Coleman, Michael S. Drake, Joseph Pacelli, Brady Twedt

Faculty Publications

We offer novel evidence on how the nature of brokerage-client relationships can influence the quality of equity research. We exploit a unique setting provided by the Protocol for Broker Recruiting to examine whether relaxed broker noncompete agreement enforcement generates spillover effects on sell-side analysts. Entry into this agreement reassigns ownership of the client relationship from the brokerage to individual brokers, potentially generating a greater standard of care. Using a generalized difference-in-differences research design, we provide evidence consistent with brokers reducing pressure on analysts to produce optimistic research following protocol entry. This effect is concentrated among less experienced and non-All Star …

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The Relevance Of Non-Income Tax Relief*, Michael S. Drake, Ryan V. Hess, Jaron H. Wilde, Braden M. Williams Jan 2022

The Relevance Of Non-Income Tax Relief*, Michael S. Drake, Ryan V. Hess, Jaron H. Wilde, Braden M. Williams

Faculty Publications

Governments regularly offer non-income tax relief to attract business investment. However, it is unclear whether or how markets impound information about the relief into security prices. We use novel data from retrospective public records to examine the information content of non-income tax relief. We predict and find that the receipt and magnitude of this relief are both strongly associated with recipients’ future accounting performance and future abnormal returns. We further find that abnormal returns associated with the relief cluster around future earnings information events. In combination, this evidence suggests that non-income tax relief is value-relevant but is incorporated into prices …

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A Tale Of Two Index Funds: Full Replication Vs. Representative Sampling*, Travis Dyer, Nicholas Guest Jan 2022

A Tale Of Two Index Funds: Full Replication Vs. Representative Sampling*, Travis Dyer, Nicholas Guest

Faculty Publications

We examine the two approaches used by equity index funds to track their benchmark index. The first, full replication, mimics the index with exactness. The second, representative sampling, holds a subset of the index. We find that samplers trade 3-4 times more, have 30-50% higher expenses and fees, and earn 50-70 basis points lower annual returns, which is substantial given index funds’ mandate to limit tracking error to a few basis points. Besides higher expenses and transaction costs, poor stock picking also seems to contribute to samplers’ return underperformance. Overall, our analyses suggest representative sampling is associated with underperformance.

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Tax Boycotts, H. Scott Asay, Jacob Thornock, Jeffrey L. Hoopes, Jaron H. Wilde Jan 2022

Tax Boycotts, H. Scott Asay, Jacob Thornock, Jeffrey L. Hoopes, Jaron H. Wilde

Faculty Publications

To what extent do consumers boycott in response to corporate tax activities? Anecdotes suggest potential consumer backlash is a meaningful deterrent to corporate tax planning, and the tax literature has developed expectations that these boycotts happen. But empirical evidence on their existence and impact is limited. We undertake a comprehensive study to examine how consumers’ purchase behavior relates to corporate tax activities, triangulating across several designs, samples, and measures. First, we survey a representative sample of U.S. consumers to examine the reported relationship between corporate tax planning and consumer behavior; we find that consumers report that precisely zero have ever …

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The Relationship Between Perceived Fairness In Executive Compensation And Managerial Behavior, Kainan Xiong Jan 2022

The Relationship Between Perceived Fairness In Executive Compensation And Managerial Behavior, Kainan Xiong

Theses and Dissertations (Comprehensive)

This dissertation examines the relationship between the perceived fairness in executive compensation and the level of earnings management on the one hand and the propensity for voluntary turnover on the other. Executive compensation has attracted significant academic attention for more than two decades. The ratcheting-up of executive pay raises questions about its determinants and whether the pay-setting process effectively promotes managerial behavior that aligns with the interests of shareholders. Alternatively, executives may simply extract rents at the expense of shareholders because of the informational advantage that they have and their influence over the board of directors, particularly the compensation committee …

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Three Essays On The Impacts Of Tax Planning And Earnings Management On The Informativeness Of Taxable Income, Book Income, And Cash Flows From Operations, Yong Qiang Chen Jan 2022

Three Essays On The Impacts Of Tax Planning And Earnings Management On The Informativeness Of Taxable Income, Book Income, And Cash Flows From Operations, Yong Qiang Chen

Theses and Dissertations (Comprehensive)

This dissertation comprises three independent but highly related essays that investigate the effects of tax planning and/or earnings management. The first essay investigates how high tax planning and/or aggressive earnings management affect the relative and incremental value-relevant information of taxable income, book income, and cash flows from operations (CFO). Regarding the effects of tax planning, first, I postulate and show that high tax planning reduces the relative and incremental information of taxable income to CFO. Second, high tax planning increases the relative and incremental information of CFO to the combined information set of taxable income and book income. Third, high …

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The Technical Skills Valued By Public Accounting Firms, Nicholas P. Mokas Jan 2022

The Technical Skills Valued By Public Accounting Firms, Nicholas P. Mokas

Honors Theses and Capstones

Accounting firms are continually working to improve the efficiency and effectiveness of their work. As part of these efforts, firms adopt new technologies like bots, analytics, and specialized software. As accounting firms become increasingly reliant on newer technologies, colleges need to continually reevaluate their required curricula to ensure that their students are adequately prepared for their future careers in accounting. To fill a gap in the extant literature, the objective of this study is to examine the technologies and skills accounting firms value and the proficiency of new hires with these technologies and skills. To complete this objective, a survey …

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