Firms often change their operating policy to meet a short-term financial reporting target. Accounting researchers call such an opportunistic action real earnings management (REM). They measure REM by the difference between a firm's costs and those reported by its industry peers. Firms that...

Prior studies show that a lender's incentive to monitor a client's activities declines after receiving insurance on its loan via a credit default swap (CDS). We examine whether this altered debtor-creditor relation affects borrowers' investment activities. We hypothesize that the borrower...

Regulators have alleged that digital giants (Alphabet, Facebook, Microsoft, Apple, and Amazon) have misused their market power to earn abnormal profits. Research that systematically documents whether technology firms earn abnormal profits is limited, arguably because (i) U.S. GAAP based...

Managers often have foreknowledge of events that can increase future firm risks. In this study, I examine whether managers alter their personal portfolios based on their foreknowledge. Specifically, I examine whether managers expedite or delay their stock option exercises in anticipation of...

We construct a measure of intangible intensity — intangibles talk — based on textual analysis of discussions on intangibles in a firm’s 10-K filings. This measure is based on firms’ discussion of ex-post outcomes of intangibles investments. Our measure is correlated with, but carries...

The purpose of this article is to illustrate the growing limitations of the current methods of calculating earnings, particularly when earnings is a negative number. Earnings, presumably the most important output of a financial reporting system, is not a singular metric. It is obtained by...