This study provides evidence concerning the significance of assessing operational control risks as part of an integrative evaluation of internal controls. We examine whether operational control weaknesses can be used as cues to potential unreported financial reporting control weaknesses, and in...

Prior research finds that donors reward nonprofits that report larger program ratios with more donations and that managers overstate these ratios, ostensibly to attract donations. We examine how donors react to inflated ratios. We find that the average donor discounts ratios that are inflated by...

This paper studies the bank's decision on waiver of debt- covenant violations, loan renegotiation, and borrower's dividend policies and accounting choice. It delineates the conditions under which the borrower has an incentive to manipulate accounting information. This study describes a...

Fraudulent financial reporting has become an important issue in accounting profession. The implementation of self assessment system appears as incentives to companies to misstate their financial reports to reduce tax obligation. Fraudulent financial reporting may cause vast losses to government...

One of the goals of the Sarbanes-Oxley Act (hereafter SOX) was to restore confidence in financial reporting by providing incentive for firms to report financial results that reflect the underlying economic performance. Early findings are inconclusive on the success of the Act. Cohen, Dey and Lys...

Over the last thirty years, numerous parties have discussed whether CEOs and CFOs should certify the appropriateness of their financial statements. Despite the interest in this issue, there is limited empirical research on whether a voluntary disclosure system for CEO\CFO certifications provides...

We examine whether chief financial officers (CFOs) with accounting backgrounds (accountant CFOs) are associated with more conservative corporate outcomes. We find that, in high-growth industries, firms with accountant CFOs invest less in research and development and capital expenditures and are...

Financial misrepresentation has usually been analysed by large-scale empirical research. However the generality gained from such an approach is at the cost of understanding the rich and complex nature of financial misrepresentation in real organizations. We adopt a case study approach to gain...

We conduct a meta-analysis of the association between audit committee (AC) independence and financial reporting quality (FRQ). Although we cannot reliably aggregate results across studies in a statistical sense because of inconsistencies in defining FRQ and the absence of replication studies,...

We find that mean municipal debt costs are greater following financial restatement disclosures. Comparisons of the relative use of municipal debt, and of the use of unsecured versus secured debt, corroborate that financial restatements increase the cost of municipal debt financing. Additional...