Extant literature has emerged testing the relationship between executive compensation and earnings management and many these studies have documented that compensation contracts create strong incentives for management discretionary behavior over financial reporting. Previous studies also pointed...

In this study, I summarize the current state of executive compensation, discuss measurement and incentive issues, document recent trends in executive pay in both U.S. and international firms, and analyze the evolution of executive pay over the past century. Most recent analyses of executive...

Prior research argues that a manager whose wealth is more sensitive to changes in the firm's stock price has a greater incentive to misreport. However, if the manager is risk-averse and misreporting increases both equity values and equity risk, the sensitivity of the manager's wealth to changes...

Extant literature has emerged testing the relationship between executive compensation and earnings management and many these studies have documented that compensation contracts create strong incentives for management discretionary behavior over financial reporting. Previous studies also pointed...

The U.S. equity compensation landscape continues to evolve. Recent innovations have improved the linkage between pay and firm-specific performance, but have added complexity. Against that backdrop, this Article urges reconsideration of the accounting rules for equity pay. Under current rules,...

Firms can report comprehensive income in either an income-statement-like performance statement or the statement of equity. Traditional theories of contracting incentives cannot explain this reporting location choice that only affects where comprehensive income data appear, because the...

The discussion on value-based performance measures is centered around the concept of residual income. The main property of residual income is its connection to capital budgeting and the net-present-value-rule. This property is, however, not sufficient to guarantee strong goal congruence between...

I investigate the relation between the structure of CEO compensation and the investment horizons of a firm's institutional investors and find results consistent with the assertion that short-sighted institutions' focus on short-term earnings leads firms to grant more options with higher...

We investigate incentives that led to the rash of restated financial statements at the end of the 1990s market bubble. We find the likelihood of a misstated financial statement increases greatly when the CEO has very sizable holdings of stock options quot;in-the-moneyquot; (i.e., stock price...

Firms can report comprehensive income in either an income-statement-like performance statement or the statement of equity. Traditional theories of contracting incentives cannot explain this reporting location choice that only affects where comprehensive income data appear, because the...