We test the assertion that a consequence of voluntarily adopting International Accounting Standards (IAS) is the enhanced ability to attract foreign capital. Using a unique database that reports firm-level holdings of over 25,000 mutual funds from around the world, our multivariate tests find...

We draw on the investor protection literature to identify structural factors in the financial reporting environment that are likely to explain cross-country differences in the information content of annual earnings announcements. Using data from over 50,000 annual earnings announcements in 26...

This study investigates the relatively recent and growing trend in analysts disseminating operating cash flow forecasts. Consistent with our expectations, we find that analysts tend to forecast cash flows for firms where accounting, operating and financing characteristics suggest that cash flows...

This paper examines the relation between economic incentives to manage earnings and discretionary accruals and the modifying effects of audit quality on this relation. We hypothesize that incentives to smooth earnings and incentives created by debt agreements motivate managers to strategically...

This paper examines accounting choice as reflected in the behavior of discretionary accruals for a sample of auditor change firms. Discretionary accruals are estimated around the time of the auditor change using a variation of the Jones (1991) technique. After controlling for several potentially...

Prior research has focused on management's concern with current relative performance to explain income smoothing. Recent economic theory, however, argues that concern about job security creates an incentive for managers to also consider anticipated future relative performance. Our empirical...

We investigate whether PCAOB inspections affect the quality of internal control audits. Our research design improves on prior studies by exploiting both cross-sectional and time-series variation in the content of PCAOB inspection reports, while also controlling for audit firm and year fixed...

Existing research on opinion shopping focuses primarily on managers' attempts to switch auditors in order to avoid the receipt of an unfavorable audit opinion. We extend this literature by examining whether managers successfully shop for auditors who will allow questionable accounting practices,...

We investigate whether Public Company Accounting Oversight Board (PCAOB) inspections affect the quality of internal control audits. Our research design improves on prior studies by exploiting both cross-sectional and time-series variation in the content of PCAOB inspection reports, while also...

We find that non-Big 4 audit offices with greater awareness of SEC enforcement are more likely to issue first-time going concern reports to distressed clients; where SEC “awareness” is measured using (1) audit office proximity to SEC regional offices, and (2) proximity to specific SEC...