An important goal of accounting research is to provide evidence that improves the analysis of financial statements for predicting future profitability. Research (Sloan 1996; Xie 2001) has found that (1) the persistence of earnings performance depends on the proportions of the cash and accrual...

In this paper we investigate whether voluntarily disclosed reasons for auditor-client realignments (as encouraged by the SEC) have information content for investors. After classifying realignment reasons into two types - verifiable and non-verifiable, with the latter representing disclosures...

We document post-event negative abnormal returns to the (implicit) sell recommendations of a group of fundamental analysts. We also find statistically significant deterioration in the financial performance of the identified firms in the year after the recommendations. Together the results are...

Prior research shows that a higher proportion of accrued relative to cash earnings is associated with lower earnings performance in the subsequent period (Sloan 1996). The result has been widely interpreted as indicative of higher levels of operating accruals relative to cash flows from...

We examine discretionary accruals associated with firms' reaching profitability after a series of quarterly losses. We posit that as firms approach profitability they are less likely to use income decreasing discretion given the reversing nature of accruals. We find results consistent with this...

This study investigates tying in the banking industry and finds that large banks engage in tying activities. AFP survey findings indicate that lines of credit are the most likely credit instrument to be used in tying activities. Using the Feltham-Ohlson framework and the assumption that...

This study examines the relationship between lean implementation and managerial ability in the healthcare industry. Using a panel data set from U.S. short-term, general, acute care hospitals from 2000 to 2015, we conduct unidirectional analysis and two-stage Probit least squares regression to...

We examine the impact of differential incentives arising from proximity to debt covenant violation on earnings management. We reason that firms with loans close to violation or in technical default of their debt covenants have greater incentives to engage in earnings management than firms that...

Purpose – This paper examines whether the implementation of ERP impacts both business strategy and organizational capabilities which in turn enhance firm performance. Specifically, the paper investigates the mediating effect of business strategy and organizational capabilities on the...