19 Poster Session
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ItemDispelling the Myths of Generalized Online "Best Practices": What Approaches are Best for Accounting Classes Taught Online( 2020-08-18)The Covid 19 pandemic forced US institutions of higher learning to seriously and aggressive consider the best methods for teaching our courses without the luxury and familiarity of a classroom. For many, the experience of teaching online was new and uncomfortable. In the midst of the rush to online, a great deal of reliance was place on theoretical best practices for online courses. Now that pressure has lessened, it is an appropriate time to consider if the information we have been given really represents "best practices."
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ItemControl and care in big projects( 2020-08-16)There are significant differences in how project managers are recommended to engage in formal control in complex projects that are strictly limited in terms of the ‘Iron Triangle' of time, scope and budget, and how managers actually do that in practice. How managers activate their chosen strategies for organizing and controlling projects with care is rarely discussed. Two construction projects are studied (Ukraine vs. Norway). The experiences of key people involved in controlling the projects are analyzed in order to discuss how managers mobilize informal controls with care, to repair the failures of formal controls. The paper illustrates how care and control complement each other in big projects by enhancing trust, empathy, help, lenience in judgment, and courage among project participants, thus facilitating the projects' progress. The study emphasizes that how a control system is mobilized through care is more important than how ‘perfectly' it is designed.
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ItemDo Corporate Restructuring Announcements Imply Bad News? Evidence from Short Selling( 2020-08-15)Corporate restructurings involve substantial strategic changes and often occur when a corporation faces an inflection point, after which it aspires to improve performance. Despite a lengthy record of research into equity market investors' short-term responses to restructuring announcements, results remain ambiguous. In this study, we investigate investors' reactions to restructuring announcements based on the behavior of short sellers. Relative to other equity investors, short sellers are better equipped to discern whether restructuring plans will succeed. Given their approach of profiting from market price declines, short sellers will focus their investment in those restructuring corporations with low odds of success. Using a sample of corporate restructurings announced from 2010 to 2017, together with daily short selling data, we find evidence of increased trading by short sellers on and immediately after (but not before) corporate restructuring announcements. With a finer measure of restructuring, restructuring costs, we again find a significant association with abnormal short selling, but only for cost restructuring announcements. Finally, when we examine whether short sellers use the restructuring announcement to trade profitably, we find a modest but significant association between short selling activity on or after the restructuring announcement and negative future stock returns. When we partition our sample between cost and asset restructuring announcements, we find evidence of an association between short selling activity and cost restructuring announcements, and with negative future stock returns, but not with asset restructurings. This result suggests short sellers only trade profitably on cost restructuring announcements, meaning those firms' restructuring announcements foretold bad news. By relying the investment and trading of a novel set of investors for this setting, our study adds results with a clear perspective to the existing literature.
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ItemAnalyst Incentives, Stock Price Informativeness, and Market Fragility( 2020-08-14)We study the role of analyst incentives in the overall information environment in the stock market, focusing on the fundamental changes brought by MiFID II on the sell-side research industry in Europe. Implemented in 2018, MiFID II substantially changed analyst incentives, forcing them to work harder to justify the value they add. We find that, although the number of analysts decreases, the average stock price informativeness increases, measured as a decrease in stock return synchronicity with the market. The decrease in synchronicity is larger for firms that are likely to be more important for the analysts and brokers covering them. It is also asymmetric and substantially larger for downside market movements. Similarly, stock price crash risk decreases following the introduction of MiFID II. Both results indicate that the market becomes less fragile. Our results suggest that, by changing incentives, MiFID II not only improves the quality of individual analyst work, as reported by prior studies, but also achieves an improvement in the aggregate information environment with fewer analysts producing this information.
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ItemIntangible Investments and the Cross-Section of Stock Returns( 2020-08-14)In this paper, we examine whether reporting intangible investments as an expense affects firms' stock returns. We propose a comprehensive measure of intangible investments including both of firms' R&D and SG&A expenditures. Each of these two components is important in predicting stock returns in the future. The equal- and value-weighted average return spreads are all between 1.42% and 1.58% at the monthly level between the intangible-investment-sorted quintiles. They are highly significant at the 1% level. After controlling for one component, the return spread sorted on another component is still large and significant. These findings suggest that both of the intangible investment components are important and they include independent information in predicting stock returns.
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ItemImproving Accounting Ethics: Extending the Theory of Planned Behavior to Include Moral Disengagement( 2020-08-06)We extend the Theory of Planned Behavior (TPB) for ethics in the accounting workplace. Using a path modeling methodology, we find evidence that, for ethics, moral disengagement is an antecedent to the TPB predictors of attitude, subjective norms, and perceived behavioral control (PBC). Thus, to improve ethics, reducing moral disengagement is critical. We show that the TPB predictors mediate the influence moral disengagement has on ethical behavioral intentions. We find support for including both types of PBC (self-efficacy and locus of control) when modeling ethical behavior. We use four ethical scenarios and international data to test this model. We also evaluate potential positive influences on ethics in the workplace and find that recency of ethics training interacts with religiosity and activates it to reduce moral disengagement. We also find that principles-based ethics training enhances professionals' self-efficacy to behave ethically. Experience, including time as a member in a professional accounting organization, increases both locus of control and self-efficacy to behave ethically. These variables—recency of ethical training, religiosity, principles-based professional ethics training, and experience—influence parts of the core TPB model, which in turn lead to improved ethical behavioral intentions.