This study addresses the discretionary capitalization of R&D costs in Australia and Canada. We demonstrate, for both samples, that the discretionary capitalization of development costs (hereafter capitalized D) by the manager results in balance sheet and income numbers that are more highly...

This study documents a substantial impact of Big4 auditor choice on the sale proceeds of controlling interests of U.S. private firms. A representative private stock-purchase company with median enterprise value ranging from $14 to 18 million experiences a dollar value decrease in enterprise...

The costs and benefits of the Sarbanes-Oxley Act of 2002 (SOX) have been oft-debated since the inception of the Act. Much of the extant literature has assessed the costs and benefits of SOX to publicly-traded companies. We focus on the costs of SOX compliance for private firms wanting to exit...

Two standard setting approaches have emerged globally to guide the choice of accounting for securitizations: the control and components approach (FAS125/FAS140) and the risks and rewards transfer approach (IAS39). A lack of consensus about derecognition accounting is a major impediment to...

In the presence of litigation facing suppliers, the supply-chain relationship is at risk. Suppliers with principal customers (dependent suppliers) have a higher concentration of sales to customers, and they are more at risk relative to suppliers without principal customers (non-dependent...

This paper develops and tests an information-based model for conditions under which analysts earnings forecasts are likely to be more accurate than forecasts of time-series models. Three information variables are considered, namely the dimensionality of the information set, the precision of the...

Little attention has been paid to a principal decision context in which analysts' earnings forecasts are prepared, namely, as an input to their recommendations. We use two data sets, Value Line, USA, and Research Evaluation Service, Canada, and examine the importance of analysts' earnings...

Strong-form efficiency on the Toronto Stock Exchange is examined by focusing on the stock price forecasts of brokerage-firm analysts who follow TSE firms. Two principal analyses are undertaken. First, there is considerable evidence in both the U.S. and U.K. that analysts possess valuable private...

Public disclosure about effectiveness of internal control systems is subject to much controversy in Canada, resulting in Canadian disclosures being made in Management Discussion and Analysis (MDamp;A). These disclosures are provided to investors without a definition of the weaknesses to be...