We explore the capabilities and dangers of artificial intelligence (AI) usage in accounting research. We focus on mining U.S. securities regulations as an economic shock, testing the causal effect of these shocks on U.S. firms’ voluntary disclosure, and writing a complete academic paper, conditional upon finding statistically significant results. Overall, this research experiment demonstrates the capacity for AI to provide efficiencies in research. AI-generated papers are not ready to be submitted to top accounting journals, but they constitute a useful starting point for accounting researchers and using AI saves valuable time in identifying exogenous shocks that significantly affect an outcome of interest. When we repeat the same experiment to explore the causal effect of non-U.S. securities regulations on U.S. firms’ voluntary disclosure practices, AI writes many professional looking papers with spurious results and unsubstantiated economic arguments, highlighting the potential dangers of AI for accounting scholarship

We study whether mandatory surveys of patient experience affects patient mortality in U.S. hospitals. We exploit two settings where healthcare regulators mandated the Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) survey: the 2003 Maryland pilot study and the 2007 nationwide adoption. Difference-indifferences analyses show increased mortality for hospitals that were subject to the mandate, relative to other comparable hospitals. We observe this effect before hospitals disclose their HCAHPS ratings, which suggests that it is attributable to measurement, rather than to disclosure. An analysis of changes in hospital expenses shows that, after the mandate, affected hospitals experienced a relative increase (decrease) in non-clinical (clinical) expenses. This finding is consistent with theories of multitasking, which predict that more incentives for one task (in this case, patient experience) cause some reallocation of resources from other tasks (clinical care).

This study investigates the effect of national security-related foreign investment screening laws on managers’ investment choices. These laws weaken takeover markets by granting regulators broad new powers to revise or reject foreign takeovers of firms in national security-related industries. I identify exogenous variation in national security-related foreign investment screening laws using the enactment of a U.S. national security-related foreign investment screening law known as the Foreign Investment and National Security Act (FINSA). Consistent with managerial entrenchment theory, I document that, following the enactment of FINSA, national security firms’ inefficient investment increases. Event-time tests corroborate and cross-sectional tests demonstrate that results strengthen with treatment strength. Results generalize to seven alternative investment efficiency measures. Stacked panel tests exploiting regulators’ staggered enforcement of FINSA across 66 industries over time between 2008 and 2021 further corroborate. Overall, this study documents the unintended consequences of national security-related foreign investment screening laws on managers’ investment choices.

Form 10-K offers a setting for studying how users process complex, multi-layered disclosures: managerial narratives in the main file alongside separate exhibits, such as contracts and certifications, that provide unfiltered detail. Drawing on rational inattention theory, we investigate how users allocate limited attention across these components. Users typically begin with the main file and selectively access exhibits when the main file appears shorter, less readable, or less confident, indicating higher perceived information loss. This pattern strengthens for exhibits that offer more detail on topics discussed in the main file and among institutional investors and time-constrained users. Exhibit access persists beyond the initial filing window and increases around subsequent firm events, especially when external monitoring strengthens and event-related information asymmetry grows. Collectively, our findings underscore the active, discerning nature of user attention in navigating multi-layered disclosures and reveal the often-overlooked informational value of exhibits in Form 10-K.

The PCAOB adopted critical audit matters (CAMs) to meet public demand for informative audit disclosure, but stakeholders are concerned this goal has not been achieved. We explore this disconnect via interviews with 30 highly experienced auditors. We find that audit firms expended considerable resources to implement CAM best practices. However, overwhelming institutional pressure gave rise to informal rules of thumb that prioritize symbolic comfort over substantive change. The first is don’t be an outlier , so auditors defer to the national office to ensure conformity and avoid PCAOB scrutiny. The second is report the “right” number of CAMs by never reporting zero and reporting at least one recurring CAM. The third is avoid surprises by communicating with the client to ensure that CAMs do not contain original information and allowing management to preempt auditor disclosures. Collectively, these rules yield CAMs that comply with PCAOB standards but do not provide new information and instead maintain the status quo.