This study examines how emphasis framing in narrative disclosures, and the investor characteristics numeracy and persuadability, affect investors' ability to discriminate between firms' better and worse financial performance. In an experiment with 264 participants from the general population, we...

A growing stream of research in accounting and finance tests the extent to which the tone of financial disclosure narrative affects security prices, over and above the disclosed financial performance. These studies measure tone by counting the relative frequency of positive versus negative words...

This study evaluates the extent to which the FASB and IASB convergence projects and the EU-wide adoption of IFRS have impacted the differences between firms' financial results under U.S. GAAP and IFRS. Using 2004 to 2006 reconciliation disclosures of 75 EU cross-listed firms, we find that the...

Earnings press releases are an important means by which many firms communicate to investors. This study examines whether investors are influenced by how earnings press releases are written - the tone and other stylistic attributes - using actual earnings press releases and archival capital...

In this paper, we investigate whether related party transactions are associated with earnings management. If a firm's executives and/or board members engage in related party transactions to expropriate the firm's resources, then they have incentives to manage earnings either to justify (or...

Similar to a classic event study, this study examines market reaction to firms' earnings announcements. This study extends the examination to include a broad range of concurrent disclosure contained in earnings press releases: financial disclosure captured as accounting ratios; and verbal...

International Financial Reporting Standards (IFRS) allow managers flexibility in classifying interest paid, interest received, and dividends received within operating, investing, or financing activities within the statement of cash flows. In contrast, U.S. Generally Accepted Accounting...

We document that credit spreads are positively related to two types of executory contracts: noncancellable operating leases and unconditional purchase obligations. However, while leases and purchase obligations receive the same treatment by the Bankruptcy Code and current financial reporting...

The Bullwhip Effect amplifies demand variations through a supply network. Accordingly, we expect that the Bullwhip Effect decreases earnings quality and increases the uncertainty of the public information available to stock investors and creditors. Based on a sample of US public firms from 1998...

This study investigates comparability of firms' financial statement structure, i.e. similarity of lineitems, and its effects on accounting information users. Prior research demonstrates a relationship between accounting-function comparability (i.e., earnings comparability) and analysts' forecast...