Managers: Their Effects on Accruals and Firm Policies

DeJong, Douglas V.; Ling, Zhejia

doi:10.2139/ssrn.1460298

Cited by 46 publications

(64 citation statements)

References 46 publications

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“…DeJong and Ling (2013) find that manager fixed effects are significantly associated with abnormal accruals. They also report that managers who focus on external growth through acquisitions and diversification have a lower level of abnormal accruals.…”

Section: Related Research and Hypothesis Development (I) Individual Mmentioning

confidence: 84%

“…Specifically, we first evaluate CEO operating ability by estimating the following equation (1) (e.g., Bertrand and Schoar, 2003;Ge et al, 2011;and DeJong and Ling, 2013). This model is designed to estimate each CEO's operating ability, controlling for a firm's time-varying and time-invariant characteristics and year effects.…”

Section: Methodology and Sample Selection (I) Research Designmentioning

confidence: 99%

“…First, CEO operating ability is estimated by regressing industry-adjusted return on assets on the firm's timevarying characteristics, time-invariant firm-fixed effects, year-fixed effects and CEO fixed effects (Bertrand and Schoar, 2003;Ge et al, 2011;and DeJong and Ling, 2013). The coefficient on CEO fixed effects represents individual-specific CEO's operating ability.…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

CEO's Operating Ability and the Association between Accruals and Future Cash Flows

Choi¹,

Han²,

Jung³

et al. 2015

Business Fin & Account

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This study investigates whether an individual CEO's operating ability, operationalized as the extent to which an individual CEO utilizes the company's assets efficiently to generate profits, explains the association between accruals and future cash flows. While this mapping can be driven by both the quality of accounting measurement and CEO operating ability, there is little empirical evidence on the latter link. After controlling for the CEO's accounting estimation ability, we find that the association between current period accruals and future cash flows is stronger when the CEO demonstrates superior operating ability. This suggests that a CEO's operating ability is an important determinant of the informativeness of current accruals for future cash flows.

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Section: Related Research and Hypothesis Development (I) Individual Mmentioning

confidence: 84%

Section: Methodology and Sample Selection (I) Research Designmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

CEO's Operating Ability and the Association between Accruals and Future Cash Flows

Choi¹,

Han²,

Jung³

et al. 2015

Business Fin & Account

View full text Add to dashboard Cite

show abstract

“…The last decade has seen a growing amount of research on the topic of managerial characteristics of CEOs. It is obvious that the sociological, professional, individual and physiological characteristics of managers may have an effect on various decisions (Bamber et al 2010;Hirshleifer et al 2012;Dejong and Ling 2013). Since CEOs are the key decision makers in voluntary FLI disclosure, it is important to investigate the relationship between their personal characteristics and FLI disclosure, which remain ambiguous in the current literature.…”

Section: Literature Review and Hypothesesmentioning

confidence: 99%

The effect of CEOs’ characteristics on forward-looking information

Alqatamin

Aribi

Arun

2017

JAAR

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Manuscript Type -EmpiricalPurpose -This paper aims to examine the effect of CEOs' characteristics on the level of FLI disclosure.Design/methodology/approach -The study uses a disclosure index to measure the level of FLI and employs random-effect and panel data regressions to examine the relationship between CEOs' characteristics and the level of FLI disclosure. The sample consists of 201 non-financial companies listed on the Amman Stock Exchange (ASE) for the period 2008-2013. Findings -The results show that the CEO age has a significant negative relationship with the level of FLI, whereas gender and overconfidence have a significant positive association with it.Practical implications -The results could be beneficial for a number of users of financial information, such as regulators, investors, auditors and lenders to make better decisions.Originality/value -The current study offers evidence of the effect of CEO characteristics on the level of FLI disclosure statements, particularly through narrative disclosures.

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“…Building on the upper echelon theory (Hambrick and Mason 1984), prior papers show that managerial styles impact operating decisions ranging from investment and financial policies (Bertrand and Schoar 2003) to their aggressiveness with tax strategies (Dyreng, Hanlon and Maydew 2010). Equally important to analysts/investors, managers also have unique financial reporting styles that impact financial communication (DeJong and Ling 2010;Ge, Matsumoto and Zhang 2011), use of forecasts (Bamber, Jiang and Wang 2010;Yang 2012) and aggressiveness with earnings management (Hribar and Yang 2010;Hwang and Kim 2010;Jiang, Petroni and Wang 2010). As analysts build a relationship with managers, they may develop a fuller understanding of the manager's operating and financial reporting styles.…”

Section: Managerial Style and Enhanced Analysts Understanding Of The mentioning

confidence: 99%

Do Analysts Follow Managers Who Switch Companies? An Analysis of Relationships in the Capital Markets

Brochet

Miller

Srinivasan

2013

The Accounting Review

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Abstract:We examine the importance of professional relationships developed between analysts and managers by investigating analyst coverage decisions in the context of CEO and CFO moves between publicly listed firms. We find that top executive moves from an origin firm to a destination firm trigger analysts following the origin firm to initiate coverage of the destination firm in 10% of our sample, which is significantly higher than in a matched sample. Analystmanager "co-migration" is significantly stronger when both firms are within the same industry. Analysts who move with managers to the destination firm exhibit more intense and accurate coverage of the origin firm than they do in other firms and compared to other analysts covering the origin firm. The advantage no longer holds after the executive's departure, and most of the analysts' advantage does not carry over to the destination firm. However, the analysts do increase the overall market capitalization of firms in their coverage portfolio. Our results hold after Regulation Fair Disclosure, suggesting that these relationships are not based on selective disclosure. Overall, the evidence shows both the importance and limitations of professional relations in capital markets.

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Managers: Their Effects on Accruals and Firm Policies

Cited by 46 publications

References 46 publications

CEO's Operating Ability and the Association between Accruals and Future Cash Flows

CEO's Operating Ability and the Association between Accruals and Future Cash Flows

The effect of CEOs’ characteristics on forward-looking information

Do Analysts Follow Managers Who Switch Companies? An Analysis of Relationships in the Capital Markets

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