Using D&O insurance premia from the 2001-2004 Tillinghast D&O insurance surveys as a proxy for litigation risk, we show that audit fees are positively associated with litigation risk even after controlling for several quantitative risk factors known to influence both the insurance premium and...

We study whether and how financial reporting concerns are priced by insurers that sell Directors' and Officers' (Damp;O) insurance to public firms. As Damp;O insurers typically assume the liabilities arising from shareholder litigation, the premiums they charge for Damp;O coverage reflect their...

We examine the effect of litigation risk on management's decision to issue earnings forecasts. We use a new ex ante measure of litigation risk, namely, the Directors and Officers liability insurance premium. This measure bypasses significant problems associated with the estimation of ex ante...

We propose a framework for an ensemble bankruptcy classifier that uses if-then rules to combine the outputs from a heterogeneous set classifiers. A genetic algorithm (GA) induces the rules using an asymmetric, cost-sensitive fitness function that includes accuracy and misclassification costs....

We examine the relationship between corporate governance and default risk for a sample of firms cited in the Securities and Exchange Commission's (SEC's) Accounting and Auditing Enforcement Releases (AAERs). Using hazard analysis of actual default incidence and OLS regressions of a continuous...

This paper develops an adaptive ensemble model for bankruptcy classification of firms cited in the SEC's Accounting and Auditing Enforcement Releases (AAER). We develop a Genetic Algorithm (GA) model for bankruptcy classification of AAER firms. Our research contributes to the bankruptcy...

Litigation risk has been hypothesized to affect managerial behavior in a number of ways. An understanding of the determinants of litigation risk is a necessary first step to analyzing managerial behavior. We examine the determinants of an ex-ante measure of litigation risk, namely, Directors and...

We examine the effect of litigation risk on managers' decision to issue earnings forecasts. We use a new ex ante measure of litigation risk, namely, the Directors and Officers liability insurance premium. This choice bypasses significant problems associated with the estimation of ex ante...

SUMMARY This paper proposes a framework for an ensemble bankruptcy classifier that uses if–then rules to combine the outputs from a heterogeneous set of classifiers. A genetic algorithm (GA) induces the rules using an asymmetric, cost‐sensitive fitness function that includes accuracy and...

I find that the total asset (TA) growth anomaly (Cooper et al. 2008) is a noisy manifestation of the net operating asset (NOA) growth anomaly documented earlier in the accounting literature. To better understand the underlying causes of the growth anomalies, I decompose TA growth into NOA growth...