This paper analyzes whether fair value estimates of fund net asset values (NAVs) produced by private equity managers are accurate and unbiased predictors of future discounted cash flows (DCF). We exploit the fact that private equity funds have finite lives to compare reported NAVs to DCFs based...

Academics and practitioners frequently highlight that overall market and industry performance is an important aspect of a firm's profitability. However, few studies allow for the decomposition of a firm's profitability into market, industry, and idiosyncratic components, and those that do often...

This paper tests the hypothesis that negative client stock returns following the revelation that Enron documents had been shredded are attributable to confounding effects as opposed to a loss of Andersen's reputation. We find that a sharp decline in oil prices along with differences in the...

This study develops a theory that predicts the lower the degree to which firms' earnings are correlated with the industry the greater the probability a firm will issue a biased signal of firm performance. The theory provides for causal predictions in our empirical tests in which we examine the...

We examine the Securities and Exchange Commission's assertion in the Pay Ratio Disclosure rule that the ratio of CEO to employee pay is useful to shareholders for say-on-pay (SOP) voting decisions. Using an estimated pay ratio for a broad panel of commercial banks from 2010-2017, we find that...

This study examines attention-driven investment decisions using a sample of firms essentially unknown to investors prior to becoming the target of a stock spam campaign. We show that the market reaction to spam varies predictably with the content of the spam message. Spam date returns and volume...

This study examines how analysts respond to public information when setting their stock recommendations. Specifically, for a sample of stocks that experience large stock price movements, we model the determinants of analysts' recommendation changes. Using an ordered probit model based on all...

Using a comprehensive sample of switches to and from the largest auditors (i.e., the Big N), we examine empirically whether the sensitivity of Big N auditor switches to client risk and misalignment changed between the pre- and post-Enron periods. Although we find an increase in the sensitivity...

We examine how analysts respond to public information when setting stock recommendations. We model the determinants of analysts' recommendation changes following large stock price movements. We find evidence of an asymmetry following large positive and negative returns. Following large stock...

This study examines former Arthur Andersen clients and provides evidence on the factors involved in their selection of new auditors after Andersen's collapse. Using a unique dataset which identifies whether or not former Andersen clients followed their audit team to a new auditor, findings...