Both bond rating agencies and equity analysts evaluate public companies and report their findings and opinions to market participants. Regulation Fair Disclosure (FD) changed the dynamics of the market and placed restrictions on the information that companies could disclose to analysts. Debt...

In 2002, the European Union (EU) Parliament passed a regulation that requires consolidated and simple accounts for all companies listed in the EU to use International Financial Reporting Standards (IFRS) for fiscal years starting after January 1, 2005. This change in accounting systems will have...

Costing systems including activity-based costing generate average cost data. When these average costs are used for decision-making it is implicitly assumed that they approximate marginal costs. (In other words it is assumed every cost is strictly proportional to activity they are entirely...

This paper investigates the use of environmental performance as a component of executive compensation. Results indicate that compensation of chief executive officers at firms with higher levels of environmental exposure includes an environmental risk premium; top executives receive compensation...

Using data from hospitals in the state of Washington, we examine the time-series behavior of overhead costs. We find that more accurate predictions of changes in costs are usually generated by assuming a cost will not change at all (except for inflation) than by assuming that the cost will...

The most widely accepted empirical dividend model is that proposed by Lintner, who argued that firms smooth dividends over time. Many theoretical dividend models, however, either predict that dividends should be highly variable, or at least offer no support for the smoothing hypothesis. We use a...

Credit ratings have significant implications for firms, including the cost of future borrowing and immediate impacts on stock and bond valuations. Because of this, managers have incentives to improve or maintain their credit ratings by influencing rating agencies' perception of credit risk. We...

We investigate the potential uncertainty-reducing role of accounting information in the context of contingent Superfund liability valuation. We first develop theoretical arguments for the way reduction of uncertainty regarding these contingent liabilities is expected to affect security prices....

The amount and timing of a firms' ultimate financial obligation for contingent environmental liabilities is uncertain and subject to the outcome of future events. We decompose uncertainty about Superfund contingent liabilities into two sources: 1) uncertainty regarding extent of site...

We examine the interaction between two forms of hospital regulation and their effect on hospital behavior. Because reimbursement under federal Medicare regulation is a fixed fee per diagnosis, hospitals are encouraged to behave more like cost centers and reduce cost through shorter average...