The COVID-19 pandemic has resulted in extreme uncertainty in the future earnings of many firms. In this paper, we examine how firms’ exposure to the pandemic affects their guidance withdrawals. Almost half the firms in our sample withdraw their management earnings guidance instead of...

We investigate the relation between the quality of bank regulatory reporting prior to and bank stability during the financial crisis that erupted in 2008. Using a large sample of private and public commercial banks in the United States and the incidence of accounting restatements as a proxy for...

When equity markets open to foreign investors, firms in these markets face significant opportunities to attract foreign capital. Using a set of countries that opened their equity markets, we find significant income-increasing earnings management in the year of opening, with substantial...

Financial technology (FinTech) companies are increasingly important in the financial system. We investigate the effect of peer-to-peer (P2P) lending on traditional banks' loan losses by examining whether and how P2P lending activity in a state affects loan loss provisions of that state's...

In this paper, I examine the impact of market inefficiency on the properties of implied cost of capital (ICC) estimates. I show that market inefficiency will bias the relation between the ICC estimate and future returns upwards. Utilizing recently developed ICC estimates formed using regression...

We examine the causal effect of expected private litigation costs on voluntary disclosure using a natural experiment, the Supreme Court ruling in Morrison v. National Australia Bank. This ruling reduced expected private litigation costs for foreign cross-listed firms by eliminating the right of...

We examine the link between bank competition and financial stability using the recent financial crisis as the setting. We utilize variation in banking competition at the state level and find that banks facing less competition are more likely to engage in risky activities, more likely to face...

Option grant vesting terms are a contractual provision that is shaped by accounting standards and other economic factors. We examine the effect of accounting standards, specifically SFAS 123(R), on the vesting terms of stock option grants while also modeling other economic determinants of this...

This paper examines the effect of transaction costs on the post-earnings-announcement drift (PEAD). Using standard market microstructure features we show that transaction costs constrain the informed trades that are necessary to incorporate earnings information into price. This leads to weaker...