Knowledge that Transforms

Information rents, Information systems, Resource allocation, Private information

Linda S. McDaniel, William R. Kinney, Jr., Expectation-Formation Guidance in the Auditor's Review of Interim Financial Information, Journal of Accounting Research, Vol. 33, No. 1 (Spring, 1995), pp. 59-76

Total quality management, Information systems, Reward systems, Organizational performance

Research Methodology, NAARS Database, Database coverage, Sampling bias

Investor sophistication, Analyst forecasts, Analyst forecast error, LIFO adoption

This paper investigates how banks alter the timing and magnitude of transactions and accruals to achieve primary capital, tax, and earnings goals. Recent research, including Moyer [1990], Scholes, Wilson, and Wolfson [1990], and Collins, Shackelford, and Wahlen [1995], provides evidence that banks execute transactions and manage accruals to achieve some or all of these objectives. A common feature of these studies is the assumption that when managers make a particular accrual or transaction decision, all other decisions are fixed. We relax this assumption and allow such decisions to be determined simultaneously.

Incentive systems, Sequential production, Capacity constraints, Manufacturing

Auditing, Audit review process, Audit-planning decisions, Audit quality

Management control, Moral Hazard, Just-in-Time management, Motivation

Leases, Operating lease accounting, Equity risk, Property rights