type="main" <title type="main">ABSTRACT</title> <p>Recent studies document that market participants react positively to the positive language sentiment or tone embedded in financial disclosures, and that investors’ reactions to negative news are more muted with poor disclosure readability. However, while language sentiment...</p>

<heading id="h1" level="1" implicit="yes" format="display">ABSTRACT</heading>We report the results of an experiment that shows that investors' earnings- and investment-related judgments are jointly influenced by their investment position (long versus short), the news valence of guidance issued by management, and the amount of ambiguity in the guidance. Prior...

<heading id="h1" level="1" implicit="yes" format="display">ABSTRACT</heading>We posit that the effect of non-audit fees on audit quality is conditional on auditor industry specialization. Industry specialist auditors are more likely than nonspecialists to be concerned about reputation losses and litigation exposure, and to benefit from knowledge spillovers from...

<heading id="h1" level="1" implicit="yes" format="display">ABSTRACT</heading>We examine whether analysts' incentives to maintain good relationships with management contribute to the optimistic/pessimistic within-period time trend in analysts' forecasts. In our experiments, 81 experienced sell-side analysts from two brokerage firms predict earnings based on...