The dissemination of knowledge in audit firms is a critical process that has gone relatively unexamined by researchers. Using social network analysis to quantify the knowledge-seeking networks in a Big 4 audit firm in the U.S., we examine the association between the types and patterns of...

Recently, the SEC's Division of Corporation Finance (CorpFin) has added an additional guidance to its Financial Reporting Manual (FRM) with respect to the disclosure for goodwill. For firms at a risk of failing the step one of goodwill impairment test, this guidance recommends that firms...

This paper examines how institutional investors respond to accounting restatements. We show that transient institutional investors, defined as institutions with shorter investment horizons and higher portfolio turnover, significantly reduce their holdings in a restating firm at least one quarter...

By developing a synthesis of documents that have been released officially under the revenue recognition project jointly run by the IASB and FASB, this article points out that the earnings generation and realisation process over time (that is to say, the traditional accounting model) is in...

Audit fee negotiations conclude with the signing of an engagement letter, typically the first quarter of the year under audit. Yet investors do not learn the audit fee paid until disclosed in the following year's definitive proxy statement. We conjecture that negotiated audit fees impound...

This paper examines the historical question of whether treasury shares and newly issued shares are equivalent by considering their use in stock based M&A transactions. We quantify the differential market response to M&A announcements when bidders have sufficient currency in the form of cash or...

Under semi-strong market efficiency future returns are unpredictable from previously released information. We test the degree of semi-strong form market efficiency in the credit default swap (CDS) market by examining the relationship between subsequent CDS returns and previously announced...

We examine whether the adoption of clawback provisions in executive compensation contracts improves the informativeness of accounting information. Contrary to conventional wisdom we find that clawbacks do not lead to improved financial reporting. Specifically, we document a significant decline...