At the beginning of the 1990s UK accounting standards were described as a ‘laughing stock’. By the millennium they were widely acclaimed and in some respects world-leading. This paper explores some of the key technical advances in this period, and the political processes employed to secure...

In our model, informed players decide whether or not to disclose, and observers allocate attention among disclosed signals, and toward reasoning through the implications of a failure to disclose. In equilibrium disclosure is incomplete, and observers are unrealistically optimistic. Nevertheless,...

We examine the properties of firms' forecasting records and whether the accuracy of their prior earnings forecasts affects investor response to their subsequent forecasts. Within the context of a Bayesian model of investor learning, we find that the stock price response to management forecast...

This study examines the role of political connections for firms' financing strategies and their long-run financial performance. We view political connections as an example for domestic arrangements which can reduce the benefits of global financing. Consistent with this argument, we find that...

Major technological, regulatory, and institutional changes have made finance more widely available in recent years. The ability of financial institutions to price a variety of exotic instruments, and to assess and spread risks, has increased. More data on potential borrowers is now available,...

The Sarbanes-Oxley Act (SOX) mandates management evaluation and independent audits of internal control effectiveness. The mandate is costly to firms but may yield benefits through lower information risk that translates into lower cost of equity. We use unaudited pre-SOX 404 disclosures and SOX...

How should national securities regulators respond to the growing trend of foreign listing and cross-border trading of stocks? This Article argues that regulatory concern and cooperation are warranted in light of the potential for opportunistic behavior by corporate managers and holders of...

In this study, we examine the association between regulation and the disclosure practices and equity market liquidity of 156 non-U.S. firms with equity traded in the U.S. during calendar years 1994 and 1995. Of these firms, 68 have equities traded on the OTC Bulletin Board (OTCBB) and are exempt...

This study investigates whether insiders who possess superior information to outsiders behave as if they time their trading around management forecast disclosures in order to earn extra profits. In the 1980s, Congress passed the Insider Trading Sanctions Act (ITSA) of 1984 and the Insider...

This paper studies the effect of the public disclosure of the Securities and Exchange Commission (SEC) comment-letter reviews (CLs) on firms' financial reporting. We exploit a major change in the SEC's disclosure policy: in 2004, the SEC decided to make its CLs publicly available. Using a novel...