This paper examines whether firms that deviate from an empirically modeled ("expected") credit rating engage in earnings management activities, as measured by abnormal accruals and real activities earnings management. We then test whether such actions are successful in helping these firms move...

We decompose quantitative management earnings forecasts into macroeconomic and firm-specific components to determine the extent to which voluntary disclosure provided by management has macroeconomic information content. We provide evidence that the forecasts of bellwether firms, which are...

Critics have alleged that securitization accounting prior to 2010 was among the causes of the recent financial crisis. In response to this criticism, the Financial Accounting Standards Board (FASB) implemented two new accounting standards, SFAS 166 and SFAS 167, to improve the financial...

We propose a new measure of readability, the Bog Index, which captures the plain English attributes of disclosure (e.g., active voice, fewer hidden verbs, etc.). We validate this measure using a series of controlled experiments and an archival-based regulatory intervention to prospectus filing...

Research on the credit rating process has primarily focused on how rating agencies incorporate firm characteristics into their rating opinions. We contribute to this literature by examining the impact of managerial ability on the credit rating process. Given debt market participants' interest in...

Prior research on the determinants of credit ratings has focused primarily on rating agencies' use of quantitative accounting information, but the impact of financial disclosures, particularly textual attributes, on the bond rating process has gone relatively unexplored. This study examines the...

This study investigates the role of tax avoidance in the credit rating process and whether differences exist in how rating agencies account for the risk relevance of tax avoidance. Using a sample of initial credit ratings assigned to public debt issuances during the 1994-2013 period, our...

Research on the credit rating process has primarily focused on how rating agencies incorporate firm characteristics into their rating opinions. We contribute to this literature by examining the impact of managerial ability on the credit rating process. Given debt market participants' interest in...

This study examines the extent to which managerial talent plays a role in shaping the clarity of regulated financial disclosures and a firm's information environment. Consistent with the notion that clear thinking leads to clear writing, we find more able management teams produce clearer and...

We examine a comprehensive set of investigations by SEC Division of Enforcement offices to provide evidence on the consequences of busyness on the formal investigation process. Our evidence suggests that higher office case backlog decreases the likelihood of investigation initiation. Consistent...