Managers’ Incentives to Manipulate Earnings in Management Buyout Contests: An Examination of How Corporate Governance and Market Mechanisms Mitigate Earnings Management

In an MBO contest, managers offer to buy the firm from public shareholders at a premium to the current market price and thus have incentives to buy the firm “cheap.” Prior studies have found evidence that managers, on average, manipulate earnings downward prior to an MBO offer in an attempt to convince shareholders that their offer is fair. We extend this finding by attempting to explain the substantial cross sectional variation in the degree of manipulation across firms reported in these earlier studies. We find that boards with more independent directors and higher levels of incentive based compensation for the CEO act to discourage such manipulation. Additionally, our results show that some shareholders, minority and preexisting large outside blockholders, appear to be misled by the manipulation. However, new blockholders that acquire large shareholdings in the year before the offer are not. We also discover that managers are more likely to revise their bid upwards when the manipulation is most severe and that these new blockholders put pressure on managers to make these revisions. Finally, we investigate whether the manipulation has an impact on the final buyout contest outcome. We find that downward manipulation does not prevent managers from retaining control of the firm; however, they pay a higher premium

Preparing Students for Team-Based Care for Vulnerable Populations

Health professionals have an obligation to improve both the health of the individual and the public in a time of scarce resources. The Institute of Medicine (IOM), Healthy People Curriculum Task Force and professional education accreditation standards indicate the need for health care professionals to demonstrate competencies related to community engagement, basic health promotion skills and the ability to work effectively in interprofessional teams. An Interprofessional Course, IPE 413: Developing Care for a Vulnerable Population provides students the opportunity to collaborate to address health needs in cooperation with a community partner. Students work in teams to address the complex health care needs of an individual community member. The one hour elective course is open to students from nursing, occupational therapy, pharmacy, social work, and exercise science. Efforts are underway to explore the possibility of offering this course to medical students. Students are assessed on the knowledge and experience gained through this interprofessional experience using the Team Skills Scale and student reflections. Faculties from each of the disciplines utilize a collaborative model in the instructional design of the course. The content is co-taught and faculty not only role model interprofessional care, but also serve as mentors and resource personnel for the students as they work with their clients

When Is Depreciation Meaningful in Valuation? Changing Valuation Weights for U.S. REITs and Non-REITs?

This article regresses the market value of equity on pre-depreciation income and on depreciation expense for capital-intensive firms, referring to the coefficients from our model as valuation weights. The valuation weight on depreciation expense versus the weight on pre-depreciation income are compared, to detect depreciation biases, over time and across sectors. Our model shows that the valuation weights on depreciation expense change over time, if the persistence of the cash flow components of net income varies over time and if the accrual for depreciation is inflexible (e.g., straight-line depreciation). For Real Estate Investment Trusts (REITs), we find the valuation weight on pre-depreciation income increases with industry upturns, while the valuation weight on depreciation expense decreases during upturns. This result is contrasted to the nearly equal valuation weights for the cash flow and depreciation components of earnings for Resource firms (e.g., mines) over time. We conjecture this is because depletion accounting flexibly allows for ???depreciation??? to exhibit less bias than in other sectors. In summary, actual depreciation practices influence time variation in the valuation of depreciation, a point which has been underappreciated in prior studies

Reprogramming of tRNA modifications controls the oxidative stress response by codon-biased translation of proteins

Selective translation of survival proteins is an important facet of the cellular stress response. We recently demonstrated that this translational control involves a stress-specific reprogramming of modified ribonucleosides in tRNA. Here we report the discovery of a step-wise translational control mechanism responsible for survival following oxidative stress. In yeast exposed to hydrogen peroxide, there is a Trm4 methyltransferase-dependent increase in the proportion of tRNA[superscript Leu(CAA)] containing m[superscript 5]C at the wobble position, which causes selective translation of mRNA from genes enriched in the TTG codon. Of these genes, oxidative stress increases protein expression from the TTG-enriched ribosomal protein gene RPL22A, but not its unenriched paralogue. Loss of either TRM4 or RPL22A confers hypersensitivity to oxidative stress. Proteomic analysis reveals that oxidative stress causes a significant translational bias towards proteins coded by TTG-enriched genes. These results point to stress-induced reprogramming of tRNA modifications and consequential reprogramming of ribosomes in translational control of cell survival.National Institute of Environmental Health Sciences (ES002109)National Institute of Environmental Health Sciences (ES017010)National Institute of Environmental Health Sciences (ES015037)National Institute of Environmental Health Sciences (ES017010)Westaway Research FundMerck Company Foundation (MIT Graduate Student Fellowship)Singapore-MIT Allianc

The development of an instrument to evaluate interprofessional student team competency

<p>Healthcare institutions, accreditation agencies for higher learning, and organizations such as the National Academy of Medicine in the United States, support interprofessional education (IPE) opportunities. However, incorporating IPE opportunities into academic settings remains difficult. One challenge is assessing IPE learning and practice outcomes, especially at the level of student performance to ensure graduates are “collaboration-ready”. The Creighton-Interprofessional Collaborative Evaluation (C-ICE) instrument was developed to address the need for a measurement tool for interprofessional student team performance. Four interprofessional competency domains provide the framework for the C-ICE instrument. Twenty-six items were identified as essential to include in the C-ICE instrument. This instrument was found to be both a reliable and a valid instrument to measure interprofessional interactions of student teams. Inter-rater reliability as measured by Krippendorff’s nominal alpha (nKALPHA) ranged from .558 to .887; with four of the five independent assessments achieving nKALPHA greater than or equal to 0.796. The findings indicated that the instrument is understandable (Gwet’s alpha coefficient (gAC) 0.63), comprehensive (gAC = 0.62), useful and applicable (gAC = 0.54) in a variety of educational settings. The C-ICE instrument provides educators a comprehensive evaluation tool for assessing student team behaviors, skills, and performance.</p