We posit that accounting conservatism could mitigate the value destruction associated with increases in cash holdings. Consistent with this conjecture, we find that the market value of an additional dollar in cash holdings increases in accounting conservatism. This result is robust to...

Prior studies examine how fraud firms manipulate accruals in order to overstate their earnings. We document that some fraud firms also manipulate operating cash flows in order to fraudulently overstate earnings. More importantly, we predict that these earnings-cash flow frauds (ECF) are harder...

We posit that accounting conservatism could mitigate the value destruction associated with increases in cash holdings. Consistent with this conjecture, we find that the market value of an additional dollar in cash holdings increases in accounting conservatism. This result is robust to...