We examine whether the strength of internal control over financial reporting (internal control) reduces the expropriation of resources from the firm by managers and controlling shareholders. Although we have ample evidence from prior literature that internal controls reduce errors in financial...

This paper examines the effect of Chief Financial Officers' (CFOs') individual philosophy or ldquo;stylerdquo; on corporate accounting choices. We track 359 CFOs across different firms over time and investigate whether CFO-specific factors explain a firm's accounting choices. We find that,...

We examine the relation between accruals quality and internal controls using 705 firms that disclosed at least one material weakness from August 2002 to November 2005 and find that weaknesses are generally associated with poorly estimated accruals that are not realized as cash flows. Further, we...