We conducted a clustered randomized field experiment with 20 Brazilian distributorships of a multi-national direct sales organization to examine whether controlling failure perceptions through formal communications increases performance. We used the organization’s weekly sales meetings to deliver a video-based message from the regional head that either communicates workers should view failure as a

We evaluate whether reported accounting numbers are informative about earnings uncertainty and whether earnings uncertainty is priced. We use quantile regressions to forecast the standard deviation, skewness and kurtosis of future earnings. These three moments are important measures of earnings uncertainty because they reflect the size of the average deviation from expected earnings and the amount

Using data from 19 countries over the 1990–2015 period, we examine how economic policy uncertainty (EPU) affects accounting quality. We find that accounting quality, measured based on Nikolaev’s (2018) model, increases during periods of high policy uncertainty. This relation is confirmed by the negative association between EPU and performance-adjusted discretionary accruals in a multivariate setting

In a controlled online experiment, we find evidence that the timing of taxes on retirement income affects taxpayers’ investment decisions such that tax-deferred plan participants under-adjust for future tax burdens and overestimate their future wealth compared to Roth participants. As a result, when presented with a specific, after-tax monetary goal, Roth account holders invest more in higher-risk

This paper empirically examines the association between bank capital and banks' monitoring effort. We use four proxies to measure the unobservable monitoring effort. Two of the proxies are based on...

The Patient Protection and Affordable Care Act (ACA) requires that insurers spend a minimum amount of their premium revenue on policyholder benefits. The Act specifies enforcement via a combination...

We analyze the effects of partner tenure and mandatory rotation on audit quality, pricing, and production for a large cross-section of U.S. public firms over the 2008 to 2014 period. On average, we...

We present 179 investment professionals with a scenario that manipulates whether a male or female analyst persists in pitching a stock pick after it has been voted down. Respondents evaluate analys...

We extend prior research examining the relation between aggregate recommendation changes and future returns by documenting that this relation varies over time as a function of the predictability of...

Periodic demand forecasts are the primary planning and coordination mechanism within organizations. Because most demand forecasts incorporate human judgment, they are subject to both unintentional error and intentional opportunistic bias. We examine whether a disaggregation of the forecast into various sources of demand reduces forecast error and bias. Using proprietary data from a manufacturing organization

We advance a theory asserting that CSR performance may exacerbate, not necessarily moderate, a company's negative stock-price response to negative events. In testing this theory, we hypothesize and...

We examine whether firms benchmark annual equity grants to compensation peers and whether meeting the participation constraint is a motive. Studying CEO equity grants over the period of 2006-2016 a...

We hypothesize that prior evidence of target shareholder capital gains tax liabilities affecting acquisition features is driven by the tax liabilities of the target firm CEO. To test this, we estim...

Auditors experience difficulty auditing accounts on which it is difficult to identify in advance all the evidence necessary to perform an effective audit. These accounts are challenging because the...

Using experiments with 58 corporate managers and 215 auditors, we examine whether managers attempt to reduce the perceived intentionality of their fraudulent misstatements by perpetrating fraud via...

We examine the relation between accounting quality and debt concentration in corporate capital structures (i.e., firms' tendency to rely predominantly on only a few types of debt). Motivated by the...

Teamwork and team incentives are increasingly prevalent in modern organizations. Performance measures used to evaluate individuals' contributions to teamwork are often non-verifiable. We study a pr...

The government requires its suppliers to have certain internal information processes to reduce uncertainty about their ability to fulfill their commitments. I argue that these requirements improve ...

We investigate whether and how a "critical audit matter" (CAM) disclosure affects managers' real operating decisions in two contexts (issuing a loan that decreases versus increases the average risk...

We exploit the staggered recognition of the Inevitable Disclosure Doctrine (IDD) by US state courts to examine the effect of trade-secret protection on the amount of firm-specific information incor...

We document multiple dimensions of usefulness of banks' interest income sensitivity disclosures. First, we find management-generated sensitivity measures are predictive of future realized changes i...

Using data on corruption convictions from the U.S. Department of Justice, we find that auditors charge higher fees when a firm is headquartered in a more corrupt district. This result is robust to ...

This study investigates the way that experienced audit committee Chairs address barriers to effective performance. We conceptualize audit committees as groups of individuals gathering, elaborating ...

During a look-back analysis, auditors review prior-period evidence to understand estimation inaccuracies and assess the reliability of management's estimation process. We find that evidence specifi...

Successful innovations could induce more disclosure if the information asymmetry between the firm and its investors about post-innovation outcomes leads investors to demand more information. Howeve...

This paper deepens our understanding of the anatomy of an earnings conference call. Prior research indicates that, on average, analysts providing bullish stock recommendations or beatable earnings ...

We investigate the relationship between societal trust and managers' decisions to voluntarily issue earnings forecasts. We reason that managers are more likely to issue earnings forecasts in high-t...

We introduce real decisions (a project choice decision, an investment scale decision, and an information acquisition decision) to the Dye (1985) voluntary disclosure framework and examine how the p...

We examine the relation between information externalities along the supply chain and voluntary disclosure. Information transfers from a major customer's earnings announcement (EA) can substitute fo...

We study how short-term changes in institutional owner attention affect managers’ short-term disclosure choices. Holding institutional ownership constant and controlling for industry-quarter effects, we find that managers respond to attention by increasing the number of forecasts and 8-K filings. Rather than alter the decision of whether to forecast or to provide more informative disclosures, attention

We conduct an experiment to investigate the differential effect of recognizing versus disclosing reasonable and supportable forecasts of future loss conditions on investors' valuation assessments w...

This paper examines how low financial reporting frequency affects investors' reliance on alternative sources of earnings information. We find that the returns of semi-annual earnings announcers (i....

To explain the empirically documented non-linear, non-monotonic relationship between earnings and firm value, it suffices to assume that firms continually take profit-maximizing decisions in respon...