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Firms can report comprehensive income in either an income-statement-like performance statement or the statement of equity. Traditional theories of contracting incentives cannot explain this reporting location choice that only affects where comprehensive income data appear, because the...
Persistent link: https://www.econbiz.de/10013152881
Evaluating agency theory and optimal contracting theory of corporate philanthropy, we find that as giving increases, shareholders reduce their valuation of cash holdings. Dividend increases following the 2003 Tax Reform Act are also associated with reduced corporate giving. Using a natural...
Persistent link: https://www.econbiz.de/10012974545
This Article reports results of an empirical study that suggests that the current economic crisis has changed managerial behavior in the US in a way that may impede economic recovery. The study finds a strong, statistically significant and economically meaningful, positive correlation between...
Persistent link: https://www.econbiz.de/10013114205
We examine the effect of CEO pensions and deferred compensation (inside debt) on firm cash holdings and the value of cash. We document a positive relation between CEO inside debt and firm cash holdings. This positive effect is magnified by firm leverage and mitigated by the presence of financial...
Persistent link: https://www.econbiz.de/10013090056
We examine the effect of CEO compensation incentives on corporate cash holdings and the value of cash to better understand how compensation incentives designed to enhance the alignment of manager and shareholder interests may influence stockholder-bondholder conflicts. We find a positive...
Persistent link: https://www.econbiz.de/10013150559
This paper uses Taiwanese data to examine the impact of firm-level corporate governance mechanisms on firms' average cash holdings. Specifically, it examines how a firm's number of banking relationships and the percentages of managerial ownership and board ownership impact the firm's level of...
Persistent link: https://www.econbiz.de/10012837473
We examine the link between CEO overconfidence and speed of adjustment (SOA) of cash holdings for listed US firms. We find a negative effect of overconfident CEOs on the SOA. Further, CEO overconfidence increases the asymmetry in the SOA between firms with excess cash and those with a cash...
Persistent link: https://www.econbiz.de/10012840355
We examine the impact of Australia's Remuneration Amendment Act 2011 on CEO compensation and its spill-over effect on cash holdings to better understand how the new legislation affects the principal–agent relationship. Using a sample of ASX top 300 firms from 2004 to 2015, we find that the Act...
Persistent link: https://www.econbiz.de/10012903233
This paper examines the impact of managerial ownership on cash holding decisions of the firms listed in Borsa Istanbul 100 index between 2005 and 2013. Main aim of the study is to analyse whether there is any evidence for managerial alignment or managerial entrenchment effect on the corporate...
Persistent link: https://www.econbiz.de/10012869868
Although compensation contracts rarely include cash holdings as a factor, we show that high cash holdings can be used by executives in the ex post bargaining over compensation. An increase of cash holdings by 10% of assets corresponds to about $2.7 million in additional CEO total compensation....
Persistent link: https://www.econbiz.de/10013004105