between 1996 and 2016. We find that sued firms respond to 10b-5 litigation with increased accounting conservatism. Consistent … with a spillover effect, we also find that non-sued peer firms increase accounting conservatism following litigation … induce accounting conservatism, extend prior studies examining the disclosure effects of litigation into the accounting …

accounting systems that are stringent compared to the unobservable true outcome. This paper shows that risk aversion mitigates … this preference for stringent accounting systems. Specifically, in a principal-agent model where the principal can choose … between two accounting systems (ASs) with different biases, the optimal choice depends on the ranking of the overall …

This paper examines the effect of accounting conservatism on firm-level investment during the 2007-2008 global … debt raising activity and stock performance. The evidence suggests that accounting conservatism reduces underinvestment in …

Watts (2003) and Ball and Shivakumar (2005) argue that accounting conservatism decreases managerial incentives to make … negative net present value investments. I develop and test a new hypothesis that accounting conservatism is associated with … managers making less risky investments. I find that under more conservative accounting managers make less risky acquisitions …

accounting conservatism. Constituency statutes allow directors to consider stakeholder interests when making business decisions … increase in stakeholder orientation leads to a decrease in accounting conservatism. In other words, as firms shift attention to … stakeholder interests, stakeholders become less concerned about shareholder expropriation and thus demand less conservatism. Cross …

In this paper, we study two types of accounting conservatism in the property-liability (P&L) insurance industry – ex …-of-the-envelope estimates indicate that the opportunity cost of engaging in accounting conservatism is modest …-ante and ex-post conservatism. Ex-ante conservatism means that firms over-report liabilities initially, before more detailed …

For a large sample of U.S. listed firms, we find that unconditional and conditional accounting conservatism help lower … bankruptcy risk. We further find that the mitigating effect of accounting conservatism on bankruptcy risk functions via cash … enhancement and earnings management mitigation channels. This evidence is relevant to accounting standards setting, financial …

We examine the relation between corporate social responsibility (CSR) performance and conditional accounting … conservatism. Drawing upon the stakeholder-engaging and information-enhancing perspectives of CSR activities, we hypothesize that … the demand for conditional conservatism, which primarily arises from various contracting parties' concern about managerial …

We examine the association between accounting conservatism, expressed in the form of asymmetric timeliness of … stakeholders, firms prioritize commitment to accounting conservatism over the needs of non-financial stakeholders and other … conservatism are negatively associated with a CSR orientation shown by firms; however, our analysis also indicates a significant …

, conservatism is harmful. However, conservatism is beneficial if accounting is relevant to the monitoring decision because it … between conservatism and strong corporate governance through the board's monitoring efficiency. We construct a model with a … board that decides whether to replace the incumbent manager based on accounting information and the outcome of its …