In response to the dramatic increase in corporate restructurings and perceived abusive accounting practices, the Emerging Issues Task Force (EITF) released Issue No. 94-3, Liability Recognition for Certain Employee Termination Benefits and Other Costs to Exit an Activity (including Certain Costs...

The use of assumed tax rates to adjust special items (e.g., restructuring charges, asset writedowns, etc.) is common in empirical accounting research, as these items are reported pre-tax and are often used in research designs that include after-tax earnings. This study aims to explore the...