We examine the valuation and capital allocation roles of voluntary disclosure when managers have private information regarding the firm's investment opportunities, but an efficient market for corporate control influences their investment decisions. For managers with long-term stakes in the firm,...

We study the resource allocation role of voluntary disclosures when feedback from financial markets is potentially useful to managers in undertaking value maximizing actions. Managers weigh the short-term price implications of disclosure against the long-term efficiency gains due to feedback...

We develop a framework with which to analyze the interactions among auditor attestation strategy, corporate investment decision, and capital market valuation. We use this framework to examine mandatory audit firm rotation (Section 207 of the Sarbanes-Oxley Act) and identify its three potential...

Studies suggest that, pursuant to the implementation of SFAS 133, even sophisticated users of financial statements find it difficult to comprehend earnings implications of hedging derivatives. Moreover, due to stringent hedge accounting requirements under these standards, many economic hedges do...

Recent corporate governance scandals have been attributed to a lack of board independence because of the influence CEOs have over their boards. However, CEOs can also affect board efficacy without compromising its independence by strategically choosing directors. We offer a theoretical framework...

This study investigates whether accrual quality, earnings persistence and earnings predictive ability are affected by the adequacy rather than the strength of corporate governance. Under the premise that firms that have consistently outperformed their industry counterparts in the past have less...

In 2002, a number of regulatory actions were introduced to alleviate the conflicts of interest faced by research analysts with investment banking affiliations. While the regulations have been beneficial to the extent that they eliminated these conflicts, they also gave rise to unintended...

We provide evidence that bank capitalization and loan-loss reserving jointly determine pro-cyclicality in lending. Using the Global Financial Crisis of 2007-2009 as our context, we document that even banks with high regulatory capital buffers (High RCB banks) reduce lending during the crisis....