This paper investigates the common, yet previously opaque, practice of using foreign audit firms (component auditors) to conduct portions of audit work for U.S. public companies. U.S. regulators have expressed concern for the transparency and quality of audits using component auditors. Employing...

Auditor-client negotiations are a common and critical part of the financial reporting process, yet we know little about contextual factors that influence negotiation judgments from the manager's perspective. Managers have incentives to act aggressively since outcomes often materially impact...

We study the headquarters location of U.S. firms with an initial public offering (IPO) over the period 2001-2011. Specifically, we examine IPO intensity, defined as IPOs in a state scaled by state population. We find that IPO intensity is positively related to various measures of education. We...

Clustering of IPO underwriting spreads at 7% poses two important puzzles: Is the market for U.S. equity underwriting services anti-competitive and why do equity underwriters invest in reputation-building? This study resolves both puzzles. Modeling endogeneity of firm-underwriter choice using a...

We create a novel dataset to examine the nature and determinants of dual-class IPOs. We document that dual-class firms have different types of controlling shareholders and wedges between voting and economic rights. We find that the founders' wedge is largest when founders have stronger...

This paper applies the theory of structured finance to the regulation of asset backed securities. We find the current regulation in Europe (Article 405 of the CRR) and the US (Section D of Dodd-Frank Act) to be severely flawed with respect to its key intention: the imposition of a strict loss...