Existing research on pooling-of-interests accounting suggests that managers are willing to pay additional transaction costs and merger premiums to use pooling to increase future accounting net income. There is currently little evidence indicating whether the firm's shareholders benefit from...

This paper investigates the role of earnings per share management in the decision to repurchase shares. We identify the conditions under which repurchases increase EPS and document the frequency of EPS increasing and EPS decreasing repurchases among U.S. firms from 1988 to 2001. We then compare...

This paper investigates the possibility of false signaling by firms announcing open-market stock repurchases. We examine a sample of 281 open-market share repurchases, with the self-styled reason of undervaluation, by firms between 1993 and 1998. Our results showed no evidence of an upward...

Signaling is the most commonly cited explanation for stock repurchases in the academic literature. Yet, there is little evidence on whether managers intentionally use repurchases as signaling devices. Using a firm's financial reporting behavior to infer managerial intent, we find evidence...

Dividend paying firms tend to manage earnings upward when their earnings would otherwise fall short of expected dividend levels. This behavior is evident only in firms with positive debt and is more aggressive prior to the Sarbanes-Oxley Act, subsequent to the 2003 dividend tax cut, in high...

This paper analyses a problem at the intersection of accounting, law and economics: the economically efficient operation of legal arangements for company failure is undermined because valuations of assets and liabilities become unstable once a firm is distressed. The paper draws on the three...

In a lot of countries, not only one but several sets of accounts have to be prepared and disclosed by (holding) companies. This paper inquires into possibly different economic functions of these sets of accounts by looking at the German dual financial reporting system, in which company (single)...

We derive a pricing model for employee stock options (ESO) that expands on Ingersoll (2006) by including default risk and that additionally considers the effects of employee over-confidence. We find that illiquidity reduces subjective value and alters incentive effects and value sensitivities....

This paper investigates the role of labor utilization in assessing equity investment risk and corporate financial policy choices. Several existing models of the firm predict that labor utilization is costly to adjust in the short run. I argue that this leads to a relatively fixed obligation to...

We study whether more asymmetrically timely earnings constrain payouts to shareholders in the presence of bad news. Our goal is to provide evidence on the ex post contracting benefits of accounting conservatism. We distinguish between cash flow asymmetric timeliness and accrual asymmetric...