Structured finance and the if-converted EPS dilution computation

This post starts with class materials, but ends with some questions for researchers.  As I was writing my EPS case for Intermediate II this spring, I ran into a kind of strange problem.  I picked 4 or 5 companies with convertible debt and fairly sizable dilution effects.  I then went to their EPS footnote to [...] Read more > >

Why powerful people are (sometimes) better liars

In a May 2010 Harvard Business Review article, Dana Carney (assistant professor at Columbia University) answers questions about her research that examines the relationship between a sense of power and the ability to deceive others. Although I highly recommend reading the actual paper (which is very well written, I might add), let me summarize the basics [...] Read more > >

Fix It: Roundtable with HealthSouth’s Former CFO, Aaron Beam

If HRC’s actual results fell short of expectations, Scrushy would tell HRC’s management to “fix it” by recording false earnings on HRC’s accounting records to make up the shortfall. – SEC vs. HealthSouth Corporation[HRC] You look back and think, ‘What was I thinking? Why didn’t I just do the right thing?’ But when you’re caught [...] Read more > >

Fix It: Roundtable with HealthSouth's Former CFO, Aaron Beam

If HRC’s actual results fell short of expectations, Scrushy would tell HRC’s management to “fix it” by recording false earnings on HRC’s accounting records to make up the shortfall. – SEC vs. HealthSouth Corporation[HRC] You look back and think, ‘What was I thinking? Why didn’t I just do the right thing?’ But when you’re caught [...] Read more > >

Comparing Commercial and Academic Risk Measures

I just read the introduction of a paper that compares commercial and academic risk measures (Price, Sharp, and Wood 2010). And the winner is (drum roll….) commercial risk measures in almost every test. Here’s the abstract: Although a substantial body of academic research is devoted to developing and testing risk proxies that detect or predict [...] Read more > >

“Must Reads” in the Earnings Management Literature

We had a great Round Table with Paul Zarowin yesterday, where we talked about the large and ever-growing literature on earnings management.  While much has been done in this area, it was clear from yesterday’s discussion that there remain many fruitful areas for future research.  If you didn’t get the chance to join us, I [...] Read more > >

"Must Reads" in the Earnings Management Literature

We had a great Round Table with Paul Zarowin yesterday, where we talked about the large and ever-growing literature on earnings management.  While much has been done in this area, it was clear from yesterday’s discussion that there remain many fruitful areas for future research.  If you didn’t get the chance to join us, I [...] Read more > >

Round Table Discussion on Earnings Management Research

On Tuesday, Dec 15th, 4 pm ET, we will be joined by Paul Zarowin. Paul Zarowin is a professor at New York University and an Editor at The Accounting Review. The topic of this session is earnings management, and Paul is going to provide us with a high level review of this literature and the [...] Read more > >