Corporate Finance Commons^™

Special Purpose Acquisition Companies

Fordham Business Student Research Journal

Special purpose acquisition companies (SPACs) are blank-check companies that raise funds from investors through a public offering of shares and warrants (known as a Unit IPO) for the purpose of buying a private firm. SPACs have no assets or business plan and their only intent is to acquire an operational business. Because of limited data (SPACs have only gained popularity in the past decade), there has been very little research into the nature of firms that are targeted for SPAC acquisitions, with most research focusing on short-term performance statistics. A SPAC transaction effectively takes an existing private business and makes …

Do Shareholders Penalize Bank Boards And Management For The Financial Crisis?

Fordham Business Student Research Journal

The 2007-2008 financial crisis was a pervasive shock that profoundly impacted the financial services industry. Often described as the worst economic crisis since the Great Depression, this event provides a unique opportunity to examine the consequences experienced by members of boards of directors and top management at bank holding companies for what shareholders may perceive as failures in oversight and excessive risk-taking. This study examines whether shareholders penalized top management at banks and provides some new evidence of the crisis’s impact on management careers. Using the 36 largest American bank holding corporations by assets as a sample, we examine director …

Underwriting Syndicates In Bric Countries: Determinants Of Syndicate Size And Member Selection

Fordham Business Student Research Journal

The process of startup firms raising capital through equity markets by issuing shares to the public is a strong sign of financial growth and innovation. Going public requires the issuing firm to share information with potential investors and requires financial institutions to underwrite the effort, typically through a syndicate. The underwriting syndicate is a coalition of competing banks that serve as intermediaries between the firm and the investors. In emerging nations, this process is compounded by the differences in the maturity of the financial markets and the economic environment. The growth and significance of capital markets in the BRIC (Brazil, …

Nol Poison Pills: Using Corporate Law For Tax Purposes, Sarah J. Webber, Karie Davis-Nozemack

Accounting Faculty Publications

Hundreds of thousands of corporations report net operating loss (NOL) carryovers every year.1 Corporations, with the benefit of NOL rules, may turn disappointing losses into favorable tax results. During economic recovery, corporations are in better position to fully utilize the benefits of NOLs generated in prior years. NOL usage is not without peril, however. Corporations should carefully monitor corporate ownership changes to ensure that NOLs are not lost to the NOL trafficking rules. Under the NOL trafficking rules, excessive shareholder turnover triggers substantial NOL limitations. Unfortunately, corporations are not in control of their shareholder turnover, and therefore not in complete …

Banks' Survival During The Financial Crisis: The Role Of Regulatory Reporting Quality, Jeffrey Ng, Tjomme O. Rusticus

Research Collection School Of Accountancy

In this paper, we investigate the effect of bank transparency before the crisis on bank stability during the financial crisis that erupted in 2008. Using a large sample of private and public commercial banks in the United States, we find that transparency enhances stability. We use two measures of transparency. We develop a new measure of financial reporting transparency based on loan loss provision estimation errors. We corroborate our findings using a second measure based on the incidence of accounting restatements. We show that lower transparency before the crisis is associated with higher non-performing loans and lower profitability at the …

Nonprofit Funding Agencies’ Review Of Grant Recipients, Siobain Mcilvain

Honors Theses - Providence Campus

Nonprofits need to be just as responsible as public corporations. Nonprofit funding agencies have the responsibility for evaluating the organizations they fund to make sure that they are operating with high integrity, maintaining strong internal controls, remaining financially stable, and overall being good stewards of the funds received. This paper will explain the criteria that a funding agency should follow in order to affect this process, as well as how a recipient nonprofit will benefit from following the criteria.

Is Tech M&A Value-Additive?, Ani Deshmukh

Undergraduate Economic Review

Given rising M&A deal volume across all high-tech subsectors, the ability to measure post-acquisition performance becomes critical. Despite this growth, the relevant academic literature is severely lacking (Kohers and Kohers 2000). Using an event-study approach, I find that acquirers and targets both realize statistically significant day-0 abnormal returns (1.23% [p<0.1] and 8.1% [p<0.01], respectively). As positive stock returns signal positive growth prospects in a semi-strong efficient market, AR regressions found that firms' technological relatedness, deal financing, purchase price premiums, and the relative book to market ratio, explained most variance. Overall, high-tech transactions are value-additive for both targets and acquirers.

A Research Proposal: How Can The United States Postal Service Respond And Recover From A Decade Of Decline?, Victoria E. Ayers

MBA Student Scholarship

The purpose of this proposal is to identify the various financial struggles the United States Postal Service is currently facing. The interpretation of the related literature reveals some of the issues which the Postal Service is currently facing. Through the analysis of articles addressing the present and past volumes of mail and the recent usage of postal facilities it is evident that there is still a need for the USPS to survive. This proposal examines the current actions taken to save the United States Postal Service from their financial turmoil and also presents the results of past actions. It is …

Can Us Economic Variables Predict Chinese Stock Market?, Jeremy Goh, Fuwei Jiang, Jun Tu, Yuchen Wang

Research Collection Lee Kong Chian School Of Business

In the last few decades, we observed a significant increase in global economic activities and these activities may have an impact on both China's economy and stock market. Given the potential impact, we empirically examine whether US economic variables are leading indicators of the Chinese stock market. Prior to China joining the World Trade Organization (WTO) in the end of 2001, we find no statistical relationship between US economic variables and the Chinese stock market returns. However, we find US economic variables have statistically significant predictive power for periods after China's admission into the WTO. In addition, we show that …

Building The Cfo Function: Roles And Responsibilities, Andrew Lee, Tracey Zhang

Research Collection School Of Accountancy

In May 2012, the Singapore CFO Institute, in collaboration with the School of Accountancy at Singapore Management University (SMU), embarked on this study with the objective of achieving a better understanding of the CFO function in today’s modern corporation. The study aims to answer a fundamental question – what do CFOs actually do? We examined several facets to this question: the key roles and responsibilities of CFOs; how those responsibilities are structured; whether those roles have changed in importance over time; what roles occupy the most of the CFOs’ attention and time; and what factors are challenging or enhancing the …

Building The Cfo Function: Roles And Responsibilities, Andrew Lee

Research Collection School Of Accountancy

No abstract provided.

2012 Q3 Market Pulse Report, John K. Paglia

Pepperdine Market Pulse Report

The quarterly IBBA and M&A Source Market Pulse Survey was created to gain an accurate understanding of the market conditions for businesses being sold in Main Street (values $0-$2MM) and the lower middle market (values $2MM -$50MM). The national survey was conducted with the intent of providing a valuable resource to business owners and their advisors. The IBBA and M&A Source present the Market Pulse Survey with the support of the Pepperdine Private Capital Markets Project and the Graziado School of Business and Management at Pepperdine University.

A Comparative Study Of Governing Board Composition And Financial Performace Measures In New Hampshire Hospitals, Heather C. Brooks

Honors Theses and Capstones

No abstract provided.

Industry Comparison Of Executive Compensation And Equity Considerations, Louis Chan

Honors Theses and Capstones

No abstract provided.

Training And Development Guide For A Culinary Department In A Private University, Kimberly Rosenbaum

UNLV Theses, Dissertations, Professional Papers, and Capstones

In an online study of the Council of Hotel and Restaurant Trainers (CHART), 53% of respondents reported their budgets for training were being carefully looked at. From this scrutiny, training budgets in the past 18 months have significantly decreased (Bertra, 2009, p. 1). Slashed training budgets have become another sign of the recessionary times, forcing operators to direct their funds to customer service, hoping to set them apart in the competitive environment known as hospitality (Bertra, 2009, p. 1).

Sgx Listing Rule 1207(10): Challenges And Opportunities For Caes, See Liang Foo

Research Collection School Of Accountancy

No abstract provided.

Raising The Bar, Jiwei Wang

Research Collection School Of Accountancy

No abstract provided.

Analysts' Industry Expertise, Ohad Kadan, Leonardo Madureira, Rong Wang, Tzachi Zach

Research Collection Lee Kong Chian School Of Business

Industry expertise is an important aspect of sell-side research. We explore this aspect using a novel dataset of industry recommendations, which are often issued by strategy analysts. We study sell-side analysts' ability to rank industries relative to each other (across-industry expertise), and how it relates to analysts' ability to rank firms in a particular industry (within-industry expertise). We find that analysts express more optimism towards industries with higher levels of investment, past profitability, and past returns. Analysts exhibit across-industry expertise, as portfolios based on industry recommendations generate abnormal returns over both short and long horizons, beyond what would be explained …

Social Networks And Risk Taking: Evidence From Corporate Control Activities, Yen Teik Lee

Research Collection Lee Kong Chian School Of Business

This paper investigates the impact of social ties between the Chief Executive Officer (CEO) andboard members on corporate risk-taking in mergers and acquisitions (M&As) and on shareholdervalue. Using a measure of CEO-director connections in a large sample of U.S. firms from 2000 to2010, we document that boardroom connections lower firm acquisitiveness. If connected CEOsundertake M&As, they are less likely to choose focus acquisitions, and more likely to pay in stock.CEO-board connections do not enhance firm value in M&As. Higher levels of boardroomconnection are associated with lower announcement returns and lower subsequent return on assets.Our results are robust to alternative explanations …

Credit Risk Dynamics In Response To Changes In The Federal Funds Target: The Implication For Firm Short-Term Debt, Kwamie Dunbar, Abu S. Amin

WCBT Faculty Publications

The recent credit crisis has raised a number of interesting questions regarding the role of the Federal Reserve Bank and the effectiveness of its expected and unexpected interventions in financial markets, especiallyduring the crisis, given its mandate. This paper reviews and evaluates the impact of expected and unexpected changes in the federal funds rate target on credit risk premia. The paper's main innovation is the use of an ACH-VAR (autoregressive conditional hazard VAR) model to generate the Fed's expected and unexpected monetary policy shocks which are then used to determine the effects of a Federal Reserve policy change on counterparty …

The Impact Of Related Party Sales By Listed Chinese Firms On Earnings Informativeness And Analysts Forecasts, Jiwei Wang, Hongqi Yuan

Research Collection School Of Accountancy

Using a random sample of 140 of China's listed firms, we show an adverse impact of related party (RP) sales of goods and services on the usefulness of accounting earnings to investors and on the quality of earnings forecasts by financial analysts. Consistent with the contention that RP sales may violate the arm's-length assumption of regular transactions and consequently impair the representational faithfulness and verifiability of accounting data, we find that earnings of firms engaged in RP sales are at least 33% less informative after controlling for factors known to affect earnings informativeness. We also find that financial analysts are …

Political Connections And Corporate Diversification In Emerging Economies: Evidence From China, Weiwen Li, Ai He, Hailin Lan, Daphne W. Yiu

Research Collection Lee Kong Chian School Of Business

Drawing upon the resource-based view, this study examines how political connections affect corporate diversification in an emerging economy. Data from a sample of 1,280 Chinese public firms over 2002-2005 show a strong positive relationship between political connections and corporate diversification. We also find that the positive relationship between political connections and corporate diversification is moderated by the level of state ownership in firms and the level of regional institutional development. Theoretical and managerial implications are discussed.

Sell-Order Liquidity And The Cross-Section Of Expected Stock Returns, Michael Brennan, Tarun Chordia, Avanidhar Subrahmanyam, Qing Tong

Research Collection Lee Kong Chian School Of Business

We estimate buy- and sell-order illiquidity measures (lambdas) for a comprehensive sample of NYSE stocks. We show that sell-order liquidity is priced more strongly than buy-order liquidity in the cross-section of equity returns. Indeed, our analysis indicates that the liquidity premium in equities emanates predominantly from the sell-order side. We also find that the average difference between sell and buy lambdas is generally positive throughout our sample period. Both buy and sell lambdas are significantly positively correlated with measures of funding liquidity such as the TED spread as well option implied volatility.

A Natural Experiment: Asset Manager Liability, Cally Jordan

Faculty Papers & Publications

It is a natural experiment: two highly integrated national economies, sharing a vast continent, a common language and hundreds of years of common experience. They are bound by a free trade agreement which has fostered strong trade flows in goods, services and capital. Yet, in important respects, the structural characteristics of their financial institutions, and the regulatory framework in which they operate, are different, so different in fact, that one country has been crippled for several years now by the global financial crisis and the other has emerged virtually unscathed. The countries, of course, are Canada and the United States. …

Two Essays In Financial Economics, Jatin Ravikant Malhotra

LSU New Orleans Theses and Dissertations

In the first chapter of this dissertation, I examine the relationship between hedging and diversification effects on CEO compensation in the Real Estate Investment Trust (REIT) industry. The REIT industry is suitable for this investigation for various reasons; primarily being that the REIT sample represents a relatively clean sample to study the effects of diversification and hedging on compensations. I find a positive and significant relationship between the interaction variable which reflects the effects of both hedging and diversification and CEO pay-for-performance sensitivity. This is consistent with the notion that managers are in a better position to manage firm risk …

Corporate Governance, Performance And Risk-Taking In The U.S. Banking Industry, Jennifer Osullivan

LSU New Orleans Theses and Dissertations

In this dissertation, we first examine the relationship between performance of the bank holding company and several board characteristics. We use five proxies for bank performance including Tobin’s Q, ROA, loan loss reserve ratio, non-performing asset ratio, and net charge-offs ratio. Board characteristic variables we include are board size, proportion of outsiders, CEO power, CEO tenure and board tenure. We find that a large board enhances bank performance, as proxied by Tobin’s Q and loan quality variables. We find no evidence that board structure or CEO power influences firm performance. We see that CEO and board tenure have a positive …

Productivity, Return-On-Capital And Stock Price Performance, Andrew Lee, Tracey Zhang

Research Collection School Of Accountancy

Productivity improvements in businesses are invariably championed as value-enhancing propositions. Whether the improvements are labour-related or asset-related, the value of a business is arguably enhanced when its employees are more productive, its assets are utilised more productively, and its operations are conducted more efficiently.

Does Earnings Quality Affect Information Asymmetry? Evidence From Trading Costs, Nilabhra Bhattacharya, Hemang Desai, Kumar Venkataraman

Research Collection School Of Accountancy

Information asymmetry in financial markets relates to the idea that one party to a transaction has better information than the other. Since financial reporting involves the transmission of value-relevant enterprise information, we investigate whether the quality of reported earnings can contribute to differentially informed financial market participants. Higher information asymmetry is costly as it increases the adverse selection risk for market participants and lowers liquidity. For a large sample of NYSE and NASDAQ firms, we show that (i) poor earnings quality is significantly and incrementally associated with higher information asymmetry, (ii) earnings quality disproportionately affects information asymmetry for firms with …

Three Essays On External Sources Of Corporate Governance, Kevin K. Lee

Graduate Theses and Dissertations

Corporate governance is the system by which corporations are controlled. External sources of governance include regulatory and market mechanisms as well as the interplay of goals between managers, the board, and shareholders. Other external sources can include informal institutions which can shape goals as well as suggested by institutional theory, effectively constrain human behavior. In my first essay, I argue that foreign direct investors can act as agents of change in corporate governance. Investigating changes in ownership and control of Swedish firms, I find that active foreign investors' participation move firms away from a Swedish stakeholder orientation toward an Anglo-American …

A Study Of Risk-Taking Behavior In Investment Banking, Elzotbek Rustambekov

Theses and Dissertations in Business Administration

This dissertation examines corporate risk-taking behavior by investment banks in the United States. This study was sparked by the collapse of Lehman Brothers, one of the largest bankruptcy filings in U.S. history. This dissertation examines the specific factors that drove investment banks such as Lehman Brothers to take excessive risks, and how the deregulation of the US financial services industry towards the end of the 1990s contributed to risk-taking behavior.

I use four theoretical perspectives to examine corporate risk-taking behavior among investment banks. These perspectives include: institutional theory, behavioral theory of the firm, knowledge based view (KBV) of the firm, …