Accounting Commons^™

Say On Pay Voting: Understanding Executive Pay Assessments Through The Lens Of Information-Processing Theory, Wichawadee Racharoenkit

Chulalongkorn University Theses and Dissertations (Chula ETD)

Although multiple studies have confirmed managerial power in executive compensation and the instances of irrational Say-On-Pay (SOP) voting in United States, the assessment of executive compensation, leading to SOP voting decisions, under these occurrences remained unrevealed prior to this research. Attempting to address these limitations, the measurements of irrational SOP voting and opportunistic executive compensation are introduced for modifying the model of SOP voting determinants, based on information-processing theory. The objectives are to investigate: the assessments of executive pay under heuristic processing, the assessment of opportunistic compensation, and the awareness of opportunistic executive pay, which could be resulted in lower …

Selling, General And Administrative Cost Asymmetry In Hypergrowth Private Fintech Firms, Chawanakorn Thienboonlertrat

Chulalongkorn University Theses and Dissertations (Chula ETD)

The study examines the selling, general, and administrative (SG&A) cost asymmetry between hypergrowth and non-hypergrowth stages of private fintech firms in the United Kingdom (U.K.). Results show that hypergrowth firms have significantly lower cost growth elasticity and cost multiplier elasticity, indicating asymmetry between non-hypergrowth and hypergrowth stages. The findings illustrate that a cost advantage from additional economies of scale during the hypergrowth stage contributes to cost asymmetry, supporting the idea that they can balance the finding of new opportunities with successfully reaping high-quality revenues while effectively dealing with managerial inefficiency. Equity fundraising from private equity and venture capital investors (PEVCs) …

The Effect Of Patent Disclosure Quality On Innovation*, Travis Dyer, Stephen Glaeser, Mark H. Lang, Caroline Sprecher

Faculty Publications

The patent system grants inventors temporary monopoly rights in exchange for a public disclosure detailing their innovation. These disclosures are meant to allow others to recreate and build on the patented innovation. We examine how the quality of these disclosures affects follow-on innovation. We use the plausibly exogenous assignment to patent applications of examiners who differ in their enforcement of disclosure requirements as a source of variation in disclosure quality. We find that some examiners are significantly more lenient with respect to patent disclosure quality requirements, and that patents granted by these examiners include significantly lower-quality disclosures and generate significantly …

Check Your Attitude: An Examination Of Companies’ Adversarial Disclosures About Tax Enforcement, Hannah W. Judd, Sean T. Mcguire, Connie D. Weaver, Junwei Xia

Faculty Publications

This study examines companies’ voluntary disclosures of an adversarial stance toward tax enforcement in income tax footnotes, where companies express disagreement with tax authorities or a willingness to litigate unresolved audit issues. We find that larger companies, industry leaders, and companies in industries with high litigation risk are more likely to make adversarial disclosures toward tax enforcement, and companies’ tax planning activities do not solely determine such disclosures. We examine the implications of adversarial disclosures on future tax audit outcomes and find that future settlement outcomes are more unfavorable for companies with such disclosures relative to those without. Finally, our …

The Icfr Process: Perspectives Of Accounting Executives At Large Public Companies, Eldar Maksymov, Jeffrey Pickerd, T. Jeffrey Wilks, Devin Williams

Faculty Publications

The Sarbanes-Oxley Act charges management with the primary responsibility for internal control over financial reporting (ICFR). However, prior research tells us little about the ICFR process from management’s perspective. We develop a theoretical model of the ICFR process from management’s perspective and examine that model by surveying 145 and interviewing 35 accounting executives at large US public companies. Our primary finding is that executives feel constrained in their ability to direct ICFR and hold perspectives that reflect these constraints. Specifically, most executives feel compelled by auditors to follow the PCAOB’s preferences even though executives believe these preferences often tend to …

Does Gender And Ethnic Diversity Among Audit Partners Influence Office-Level Audit Personnel Retention And Audit Quality?, Eric R. Condie, Ling Lei Lisic, Timothy Seidel, J. Mike Truelson, Aleksandra "Ally" B. Zimmerman

Faculty Publications

Motivated by prior literature on organizational identification and 23 semistructured interviews with a variety of U.S. audit partners and directors, we examine whether the gender and ethnic diversity of an office’s audit partners influences the retention of the office’s audit professionals and the quality of the audits conducted by the office. Using hand-collected data on U.S. audit partners, we find that greater levels of (or changes in) diversity in office audit partners’ gender and ethnicity are associated with lower (reduced) turnover among office audit professionals and higher (increased) office-level audit quality. To provide further insight into the audit quality results, …

Current Issues Faced By Controllers, Anthony C. Bucaro, T. Jeffrey Wilks, Christopher Yust

Faculty Publications

We conduct a series of semi-structured interviews with controllers and chief accounting officers from large public and private companies—over half are Fortune 500—to identify the current issues faced by the controllership function. We map these issues into the Institute of Management Accountants (IMA®) Management Accounting Competencies and highlight recent research that addresses these issues and where there are gaps. Our findings suggest three IMA competencies that weigh heavily on controllers’ minds: (1) collaboration, teamwork, and relationship management; (2) information systems and technology; and (3) talent management. Finally, we describe how the insights from controllers suggest important improvements to accounting curriculum …

A Study Of Auditors' Judgement When Taking Management's Perspective On Management Discussion And Analysis, Wattanachai Sangsuwan

Chulalongkorn University Theses and Dissertations (Chula ETD)

This experimental research examines the effect of management’s perspective on auditors’ judgment when they review management discussion and analysis (MD&A). This study predicts that prompting management’s perspective would benefit auditors by enabling them to more accurately review MD&A whether or not the MD&A is materially misstated. Contrary to our expectations, prompting auditors with a management’s perspective will backfire. The results find that auditors prompted by management's perspective are significantly more likely to accept MD&A that has an abnormally positive tone. In other words, auditors are less likely to ask management to alter MD&A that has such abnormally positive language. Management’s …

Employees’ Reactions To Their Supervisors’ (Lack Of) Discretionary Adjustments In Performance Evaluations, Joanna Andrejkow

Theses and Dissertations (Comprehensive)

The purpose of my dissertation is to investigate how employees react to their supervisors’ decisions not to use ex-post discretionary adjustments to mitigate the effects that negative unexpected events have on their bonuses. To address this objective, I pose the following research question: Will the level of interdependence inherent within the compensation of multiple employees (i.e., compensation interdependence) and the likelihood the event will reoccur (i.e., future event likelihood) affect employees’ reactions (future effort and workplace deviance) when they don’t receive ex-post discretionary adjustments to mitigate the effects of negative events?

I address my research question using an experiment where …

The Impact Of Compensation Framing On Work Relationships, Jack Wixson

Honors Theses and Capstones

This paper attempts to understand the effects of compensation framing on performance, work relationships, and organizational citizenship behavior. 108 study participants worked under either a bonus or penalty framed contract to complete an effort-based task. The results of the study indicate that employees will exert more effort to get to know their supervisor and demonstrate more good behavior under a bonus frame versus a penalty frame. These findings are important for companies to recognize how different compensation structures impact their employees. Companies can be more successful if they put in more time and effort to better understand their employees.

How Management’S Response To Fraud Affects The Likelihood Of Future Fraud., Adam Garrity

Honors Theses and Capstones

This article studies the effect of two parts of deterrence theory: sanction certainty and sanction swiftness, on their ability to prevent and deter embezzlement within companies. I will use an experiment, a research instrument, survey questions, and SPSS and ANOVA software to determine if sanction certainty and sanction swiftness have significant effects on how a fictional company is perceived by participants. Participants will be given a scenario that has a combination of a slow or swift punishment and a high or low detection rate. In the experiment, deterrence theory’s effect will be measured by dependent variables such as organizational attractiveness, …

Breaking The Glass Ceiling: Do Female Auditors In Public Accounting Shine?, Katie Dubois

Honors Theses and Capstones

This honors thesis examines the significance that female auditors have in shaping the public accounting profession. The study investigates the impact of female auditors on various aspects of the profession, including quality, profitability, and risk. By conducting a comprehensive literature review and analyzing gathered data, this research explores the factors that contribute to the influence of female auditors and the implications for the profession.

The findings highlight that female auditors do in fact impact the public accounting profession positively. Moreover, the data revealed that gender-diverse audit teams enhance audit quality and firm profitability. Client relationships are also positively influenced, as …

Board Gender Diversity And Cybersecurity Disclosure Characteristics, Katie Remeis

Honors Theses and Capstones

No abstract provided.

Cybersecurity Breaches And Auditor Turnover, Kilian O'Connell

Honors Theses and Capstones

No abstract provided.

Accounting Reporting Complexity, Audit Engagement Partner Mandatory Rotation, And Audit Quality, Clement Chen, Zhenfeng Liu, Wenye Tang, Ling Tuo

Accounting Faculty Publications

This paper investigates the influence of a firm's accounting reporting complexity (ARC) on financial statement audit quality. We predict and find that there is a non‐linear relationship between a firm's ARC and audit quality. Specifically, a more complex accounting environment—measured by ARC—leads to higher quality audits, but this effect diminishes when ARC continues to increase. Further analyses reveal that the effect is more salient among client firms that do not purchase non‐audit services (NAS). We also examine whether ARC affects audit quality in the circumstance of mandatory audit partner rotation. Empirical results show a moderating effect of ARC on the …