Purpose -This study, based on a merger of gender and accounting theories, aims to explore whether and how earnings management is affected by the presence of female directors on the board of directors and on the audit committee. Design/methodology/approach -The study employs both a univariate and multivariate analysis approach to explore the relation between female directors and earnings management in high-technology firms. In the analysis, two contemporary ex-post measures of earnings management, discretionary accruals and nonoperating accruals, as well as two ex-ante measures of earnings management, Big4 auditor and financial leverage are applied. Findings -The paper finds evidence for a negative relation between the presence of female directors and earnings management. The findings indicate that accounting aggressiveness is affected by the proportion of women on the board of directors as well as on the audit committee. Furthermore, the paper find evidences indicating that earnings management is lower when either the CEO or the CFO is a woman. Notably, in firms with a higher female representation in corporate governance and/or in top management, external monitoring by auditors and creditors seems to be weaker, yet earnings quality is higher. Additional analysis suggests that the gender of directors has value implications for analysts and investors; specifically, there is a positive relation between the proportion of female directors and the firm's value. The findings are supported by several gender theories and findings regarding women's motivation and achievement, moral values, social stereotypes and the relation between task performance and self-confidence. Originality/value -This study associates the gender of directors with earnings management by firms. The study contributes to the growing body of literature on earnings management. It should be useful to researchers, regulators, investors, analysts and creditors as well as other players in the capital markets, as it presents a new and important aspect that needs to be accounted for when assessing the quality of firms' accounting information.

A comprehensive empirical analysis of the mean return and conditional variance of Tel Aviv Stock Exchange (TASE) indices is performed using various GARCH models. The prediction performance of these conditional changing variance models is compared to newer asymmetric GJR and APARCH models. We also quantify the day-of-the-week effect and the leverage effect and test for asymmetric volatility. Our results show that the asymmetric GARCH model with fat-tailed densities improves overall estimation for measuring conditional variance. The EGARCH model using a skewed Student-t distribution is the most successful for forecasting TASE indices.

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We find evidence suggesting that taxable income management is not related to book income management in firms operating under a moderate level of book-tax conformity. For a sample of Israeli firms that the tax authorities determined had understated their earnings to avoid taxes, we do not find evidence of an overstatement of book earnings. Notably, public firms do not differ from private firms in this regard. Using a control sample of firms that were not subject to tax audits, we validate that self-selection does not affect our inferences. Given Israel’s unique “intermediate” level of book-tax conformity, an important practical contribution of the findings is in shedding more light on the question of the need for a substantial transition from nonconformity to full alignment in countries with large book-tax gaps (such as the United States). Our results showing that tax-avoiding firms in Israel, public and private alike, avoid book income management even if areas of book-tax nonconformity allow them to do so imply that a reduction in the divergence between the tax and the accounting rules may suffice to reduce managers’ opportunistic (reporting) behavior.

His research interests include public policy, public choice and game theory, collective action, constitutional change, bargaining and conflict resolution. Research projects include: mathematical models of mass collective action and political change; higher education policy; marketing policy; and peace and conflict in the Middle East. ABSTRACT KEYWORDS: reference price, consumer loyaltyWhen enticing consumers to purchase a particular brand, marketers occasionally use various promotional schemes, including price cuts. Acknowledging that consumers use a reference price (RP) in their purchasing decisions, marketers have ample opportunity to manipulate the RP in order to create a gain in the perceptions of consumers. This paper presents a conceptual framework and an analytical model for calculating the optimal RP that can be set by retailers in order to maximise their utility, given two consumer characteristics, ie the level of loyalty and sensitivity to quality variations and one structural variable -brand proliferation. The model is followed by an empirical study showing that: as loyalty level increases, the optimal RP increases; as competition increases, the optimal price decreases; and as the quality sensitivity increases, the optimal RP decreases. In practice, when the difference between the price and optimal RP is small and scarcely detectable by consumers, retailers may do better not to practise RP manipulation. In other words, retailers can practise this strategy only when competition is relatively low,