We examine institutional trading surrounding corporate news by combining a comprehensive database of newswire releases on U.S. firms with a high-frequency database of institutional trades.
Recent accounting research indicates that capital markets price firms' greenhouse gas (GHG) emissions and that disclosed emissions levels are negatively associated with firms' market values.
This paper examines how the interaction of perceived subjectivity and pay transparency in profit allocation is associated with an important aspect of law partners' professional judgment, namely their tendency to accede to the wishes of their client and fellow partner (labeled hereafter as partner accedence). Based on interviews with 56 corporate law partners working in large Canadian law firms, we find higher partner accedence in a less subjective system than in a more subjective system, but only under no pay transparency.
We examine whether prior findings on the market pricing of accruals quality (AQ) can be attributed to other forms of accounting-based anomalies. Using hedge portfolio analysis and cross-sectional regressions, we find that the return predictive power of AQ overlaps with several other accounting signals.
Regulators are concerned that auditors do not sufficiently identify and report material weaknesses in internal control over financial reporting (ICFR).
Prior research documents that auditors fail to revise audit plans to effectively address identified fraud cues. While auditors may understand what evidence would address such cues, we propose that auditors fail to apply this understanding because they use implemental mindsets when making decisions for themselves (i.e., deciding). However, we also propose that auditors use deliberative mindsets when advising.
Tony Wirjanto, a curator for Insurance and Asset Management for the World Economic Forum and professor at the School of Accounting and Finance, takes us through how COVID-19 has affected the insurance industry, and what can be done about it.
The repercussions of COVID-19 and worsening climate change are among the issues that will impact the insurance industry, according to Tony Wirjanto, University of Waterloo professor.
Wirjanto, working as a curator in Insurance and Asset Management for the World Economic Forum (WEF), identified eight key issues poised to influence the insurance industry in the recently released WEF Transformation Maps.
Authors Kenneth Klassen (pictured) and Nick Pantaleo explore the pressure on the CRA to raise more tax revenues, as well as assess the efficiency of the audit process and the fairness of results.
Incentives to increase assessments were amplified by recent funding for the CRA that carries an expectation that additional tax revenues of $5 will be collected for each $1 spent, a “return” that is much higher than in the past. As well, these additional tax revenues are explicitly linked to closing the “tax gap,” the CRA’s measure of how much tax revenue theoretically exists versus how much is actually paid voluntarily.
Environmental, social, and governance (“ESG”) scores have been widely touted as indicators of share price resilience during the COVID-19 humanitarian crisis. We undertake extensive analyses to investigate this claim and present robust evidence that, once the firm’s industry affiliation and accounting- and market-based measures of risk have been properly controlled for, ESG scores offer no such positive explanatory power for returns during COVID-19.