We propose that audit quality is likely to increase in the earlier years due to a Learning Effect and in later years it decreases due to a Bonding Effect. Adopting a quadratic model, we find that the average turning point is between 12 to 16 years for a large sample of U.S. firms. With an...

The Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) are currently working together towards a comprehensive standard of accounting for financial instruments with characteristics of equity, liability, or both. An important facet of this project...

I investigate how the use of extended tags in eXtensible Business Reporting Language (XBRL) filings is associated with financial analysts' forecast error and dispersion. The SEC allows firms to provide customize tags in their XBRL filings which, on the one hand, may allow firms to customize...

We investigate the association between earnings quality and price synchronicity. Price synchronicity captures the extent to which a firm's returns are explained by market and industry returns, implying that low price synchronicity could be a result of less industry-wide information impounded...

We examine the differential effects of income smoothness on value-relevance of current future earnings (termed as earnings response coefficient, ERC, and future earnings response coefficient, FERC, respectively) as affected by different information environments. In theory, if reported earnings...

Our study examines the relationship between executive pay disparity and firms’ financial reporting behavior. Tournament theory suggests that compensation differences between the CEO and other top management team executives can promote greater performance and reduce CEO entrenchment. We posit...

We demonstrate that investors in initial public offering (IPO) firms value revenues and that IPO managers report revenues opportunistically in the fiscal year just prior to the offer. We also find that these pre-IPO firm financial statements are more likely to be subsequently restated. Our...

We examine aggregate analyst forecast errors (AAFE) and find a systematic component, which is predictable using lagged stock market returns and macroeconomic variables. The evidence suggests that analysts do not fully take into account macroeconomic influences on individual firms' earnings in...

We examine the effect IFRS adoption has had on audit effort and the effectiveness of greater audit effort on constraining earnings management. While prior studies have examined the costs of IFRS adoption, it is unclear whether IFRS adoption affects audit effort and whether extra audit effort...