Financial Reporting Quality and Proprietary Costs

This study investigates the association between proprietary costs and the quality of financial reporting. Interpreting a firm’s financial reporting policy as a choice of precision (“quality”) for the disclosed accounting earnings, I find evidence that the higher the proprietary costs, the lower the precision (“quality”) of reported accounting earnings. This is consistent with analytical work in disclosure theory which suggests that, ceteris paribus, as the proprietary cost of disclosure increases, the quality of disclosure decreases

Equality and Partiality

A Review of Equality and Partiality by Thomas Nage

High performance, LED powered, waveguide based total internal reflection microscopy.

Total internal reflection fluorescence (TIRF) microscopy is a rapidly expanding optical technique with excellent surface sensitivity and limited background fluorescence. Commercially available TIRF systems are either objective based that employ expensive special high numerical aperture (NA) objectives or prism based that restrict integrating other modalities of investigation for structure-function analysis. Both techniques result in uneven illumination of the field of view and require training and experience in optics. Here we describe a novel, inexpensive, LED powered, waveguide based TIRF system that could be used as an add-on module to any standard fluorescence microscope even with low NA objectives. This system requires no alignment, illuminates the entire field evenly, and allows switching between epifluorescence/TIRF/bright field modes without adjustments or objective replacements. The simple design allows integration with other imaging systems, including atomic force microscopy (AFM), for probing complex biological systems at their native nanoscale regimes

Pion Photoproduction Amplitude Relations in the 1/N_c Expansion

We derive expressions for pion photoproduction amplitudes in the 1/N_c expansion of QCD, and obtain linear relations directly from this expansion that relate electromagnetic multipole amplitudes at all energies. The leading-order relations in 1/N_c compare favorably with available data, while the next-to-leading order relations seem to provide only a small improvement. However, when resonance parameters are compared directly, the agreement at O(1/N_c) or O(1/N_c^2) is impressive.Comment: 19 pages, ReVTeX, 50 eps files combine into 5 compound figure

Mechanisms to Meet/Beat Analyst Earnings Expectations in the Pre- and Post-Sarbanes-Oxley Eras

This paper asks two questions. First, has the prevalence of expectations management to meet/beat analyst expectations changed in the aftermath of the 2001-2002 accounting scandals and the passage of the 2002 Sarbanes-Oxley Act (SOX)? Second, has the mix among the three mechanisms used for meeting earnings targets: accrual earnings management, real earnings management, and earnings expectations management shifted in the Post-SOX Period? We document that the propensity to meet/beat analyst expectations has declined significantly in the Post-SOX Period. Our primary findings explain this pattern. In particular, we find a decline in the use of expectations management and accrual management, and no change in real earnings management in the Post-SOX Period relative to the preceding seven-year period. Our results are robust to controlling for varying macro economic conditions. These findings contribute to the academic literature, investors, and regulators

Mechanisms to Meet/Beat Analyst Earnings Expectations in the Pre- and Post-Sarbanes-Oxley Eras

This paper asks two questions. First, has the prevalence of expectations management to meet/beat analyst expectations changed in the aftermath of the 2001-2002 accounting scandals and the passage of the 2002 Sarbanes-Oxley Act (SOX)? Second, has the mix among the three mechanisms used for meeting earnings targets: accrual earnings management, real earnings management, and earnings expectations management shifted in the Post-SOX Period? We document that the propensity to meet/beat analyst expectations has declined significantly in the Post-SOX Period. Our primary findings explain this pattern. In particular, we find a decline in the use of expectations management and accrual management, and no change in real earnings management in the Post-SOX Period relative to the preceding seven-year period. Our results are robust to controlling for varying macro economic conditions. These findings contribute to the academic literature, investors, and regulators

Accrual-Based and Real Earnings Management Activities Around Seasoned Equity Offerings

We examine earnings management behavior around SEOs, focusing on both real activities and accrual-based manipulation, and how this behavior varies over time and cross-sectionally. Although research has addressed the issues of earnings management around SEOs and earnings management via real activities manipulation, ours is the first paper to put these two issues together. We make three contributions to the literature. First, we document that firms use real, as well as accrual-based, earnings management tools around SEOs. Second, consistent with the expectation that the Sarbanes-Oxley Act (SOX) has made accrual-based earnings management more costly, we find that firms have substituted from accrual to real earnings management after SOX. Finally, we show how the tendency for firms to tradeoff real versus accrual-based earnings management activities around SEOs varies cross-sectionally. We find that firms’ choices vary predictably as a function of the firm’s ability to use accrual management and the costs of doing so. Our model is a first step in examining how firms tradeoff between real versus accrual methods of earnings management

Weighing the Evidence on the Relation between External Corporate Financing Activities, Accruals and Stock Returns

Bradshaw, Richardson, and Sloan (BRS) find a negative relation between their comprehensive measure of corporate financing activities and future stock returns and future profitability. Noticing that accounting accruals are increases in net operating assets on a company’s balance sheet, we question whether it is possible to distinguish between the ‘external financing anomaly’ documented by BRS and the ‘accrual anomaly’ first documented by Sloan (1996). We show that once controlling for total accruals, the relation between external financing activities and future stock returns is attenuated and not statistically significant. These findings are consistent with Richardson and Sloan (2003)

Supersymmetric Baryogenesis from Exotic Quark Decays

In a simple extension of the minimal supersymmetric standard model, out-of-equilibrium decays of TeV scale exotic vector-like squarks may generate the baryon asymmetry of the universe. Baryon number and CP violation are present in the superpotential, so this mechanism does not rely on CP violation in supersymmetry breaking parameters. We discuss phenomenological constraints on the model as well as potential signals for the Large Hadron Collider and electronic dipole moment experiments. A variation on the TeV scale model allows the exotic squarks to be the messengers of gauge mediated supersymmetry breaking.Comment: 28 pages, 7 figures, 2 appendices, v2: typos corrected, results unchange