Outlines the role of directors and previous research on their selection, reputation, relationship to firm performance and multiple directorships, noting criticism of those who sit on many boards. Develops hypothese on the value directors provide through their time and expertise and tests them on...

Refers to previous research to suggest that US commercial bank managers use discretion to “manage” regulatory capital and that accounting discretion can influence a bank’s investment opportunity set (IOS) and therefore its share price. Challenges the assumption that using accounting...

Summarizes previous research on the impact of the investment opportunity set (IOS) on firm financing, dividend and compensation policies, develops hypotheses on the effects of IOS changes on these three areas and tests them using 1980‐1989 data from a sample of US firms moving high and low IOS...

Reviews previous research on predicting financial distress and the effects of US Chapter 11 bankruptcy (C11B); and explains how survival analysis and Cox’s (1972) proportional hazards model can be used to estimate the financial outcome for the shareholders of C11B. Reduces a previous data set...

Discusses the difficulties of measuring, defining and managing capacity; and develops a model which splits it into two components (resource and ability) plus several sub‐components, and recognizes the interfaces between them. Illustrates and defines the sub‐components and identifies three...

Outlines previous research on business failure prediction models and investigates the impact of serial correlation and non‐stationarity in financial variables on models based on linear discriminant analysis, logit and cumulative sums using 1974‐1991 data from a sample of failed and...

Notes that although previous research has found capital expenditure to be value relevant, there has been no direct evidence that it has a positive linear association with future earnings. Uses 1976‐1989 data from a sample of US manufacturing firms to examine this link and finds that firms do...

Outlines previous research into the factors influencing managers’ choice of accounting procedures and auditors’ acceptance of them, including regulatory action by the US Securities and Exchange Commission (SEC). Studies data from 1980‐1996 SEC enforcement actions against big five...

Uses previous research on firms’ potential investment (i.e. growth) opportunities, profitability and political cost/risk to suggest that a high level of growth opportunities may encourage managers to use income reducing accruals. Tests this on 1987‐1990 data from a sample of US...