In this paper we address two important questions that emerged in the aftermath of the recent banking crisis. First, did the financial statements of the bank holding companies provide an early warning of their impending distress? Second, whether the actions of four key financial intermediaries...

The short interest data reported in the United States aggregate valuation shorts (motivated by a pessimistic opinion on firm value) and arbitrage shorts (motivated by various arbitrage or hedging strategies). However, the information content of these two sources of short interest is different...

We study the behavior of short sellers around earnings restatements. We find that short sellers accumulate positions in restating firms several months in advance of the restatement and subsequently unwind these positions after the drop in share price induced by the restatement. The increase in...

In this paper we investigate the reputational penalties to managers of firms announcing earnings restatements. More specifically, we examine management turnover and the subsequent re-hiring of displaced managers at firms announcing earnings restatements during 1997 or 1998. In contrast to prior...

In this paper, we investigate the reputational penalties to managers of firms announcing earnings restatements. More specifically, we examine management turnover and the subsequent employment of displaced managers at firms announcing earnings restatements during 1997 or 1998. In contrast to...

We investigate Beaver's (2002) conjecture that the accruals anomaly is a manifestation of the glamour stock phenomenon documented in the finance literature. Value (glamour) stocks, characterized by low (high) past sales growth, high (low) B/M, high (low) E/P and high (low) C/P, are known to earn...

This is a pre-analysis plan for The Reg SHO Reanalysis Project, in which we will reassess primary results from selected recent accounting and finance papers, which exploit the randomized trial conducted by the Securities and Exchange Commission (SEC) from May 2, 2005 to July 6, 2007. As part of...

This paper empirically examines the association between bank capital and banks' monitoring effort. We use four proxies to measure the unobservable monitoring effort. Two of the proxies are based on loan quality (ex-post outcomes of monitoring effort). The other two proxies are based on salary...

The adverse consequences of poor earnings quality have been the subject of significant debate among academics, practitioners and regulators. However, the empirical evidence on pricing implications of earnings quality is sparse and controversial. We examine one potential consequence of poor...

Information asymmetry in financial markets relates to the idea that one party to a transaction has better information than the other. Since financial reporting involves the transmission of value relevant enterprise information, we investigate whether the quality of reported earnings can...