UK private and public companies face substantially equivalent regulation on auditing, accounting standards and taxes. We hypothesize that private-company financial reporting nevertheless is lower quality due to different market demand, regulation notwithstanding. A large UK sample supports this...

Falsifying Financial Statements involves the manipulation of financial accounts by overstating assets, sales and profit, or understating liabilities, expenses, or losses. This paper explores the effectiveness of an innovative classification methodology in detecting firms that issue falsified...

We examine whether New Zealand firms changed the composition of their boards of directors due to the 1994 enactment of the new Companies Act. We explore two possible effects. First, outside directors may have been more attractive, and firms may have used more outside directors after the new...

Accounting scandals and deficiencies in standards have persuaded international accounting standard-setters to rethink revenue recognition. The proposals of the joint IASB/FASB-project Revenue Recognition feature an asset-liability approach relying on measurement at fair values or at allocated...

This paper examines whether legal liability coverage, as measured by excess directors' and officers' (Damp;O) liability insurance coverage and excess cash for indemnification, is associated with the quantity and the quality of a firm's voluntary disclosures. Using Canadian firms whose Damp;O...

This paper examines the effect of managerial legal liability coverage on earnings conservatism. Using directors' and officers' (Damp;O) liability insurance coverage and cash for indemnification as a proxy for managerial legal liability coverage, we find that the higher the managerial liability...

Rules implemented by the U.S. Securities and Exchange Commission in 2003 impose additional disclosure and filing requirements on firms publicly disclosing non-GAAP earnings. We find the regulations produced (1) modest declines in the frequency of special- and other-item exclusions, (2) a decline...

We investigate the relationship of candidate information asymmetry measures to aspects of insiders' trades. For two of the measures, the median absolute abnormal return over past earnings announcements (MAG_AR) and whether the firm reports Ramp;D expenditures, associations are consistent with...

Evidence contrasting U.S. insider trades in high- and low-jeopardy periods and across firms at high and low risk for 10b-5 litigation indicates that insiders condition their trades on foreknowledge of price-relevant public disclosures, but avoid profitable trades when the jeopardy associated...

Following the enactment of the Sarbanes Oxley Act 2002, US stock exchanges strongly advocate the presence of financial experts on audit committees. However, the ideal definition of financial expertise proves to be a controversial issue culminating with the stock exchanges adopting a wide scoped...