Despite accounting conservatism and indicating the firm's required return exceeds its return on equity, equity book values greater than market values (BTM 1) are not rare. The question we address is why. We find BTM 1 is pervasive and persistent. More importantly, BTM 1 is not attributable to...

Whether fair value accounting should be used in financial reporting has been the subject of debate for many years. A key dimension to this debate is whether fair value earnings can provide information to financial statement users that is helpful in making their economic decisions. A criticism of...

The objective of this study is to understand the relation between equity market values and stock-based employee compensation expense that is disclosed, but not recognized in determining net income, under Statement of Financial Accounting Standards (SFAS) No. 123. In particular, we predict and...