[Does tax policy affect accounting choices? In this paper we examine how corporate tax affects management's accounting choices. Because (1) management compensation is typically linked to both accounting earnings and stock prices, (2) stock prices are related to cash flow distributions expected to be generated by the firm, (3) corporate-issued reports change cash flow assessments and, thus, affect compensation in a given period, and (4) changes in corporate tax rate changes the firm's cash flows, management will exploit its ability to "manage" reported accounting earnings in reaction to changes in tax rates, so as to maximize compensation. Assuming exogeneously determined generally accepted accounting principles, it is shown-using a stylized model-that increases in corporate tax rate induce choice of income-increasing accounting treatments. Empirical results applying logit analysis to a sample of compensation data are consistent with this implication of the model.]

Does tax policy affect accounting choices? in this paper we examine how corporate tax affects management's accounting choices. Because (1) management compensation is typically linked to both accounting earnings and stock prices, (2) stock prices are related to cash flow distributions expected to be generated by the firm, (3) corporate-issued reports change cash flow assessments and, thus, affect compensation in a given period, and (4) changes in corporate tax rate changes the firm's cash flows, management will exploit its ability to "manage" reported accounting earnings in reaction to changes in tax rates, so as to maximize compensation. Assuming exogeneously determined generally accepted accounting principles, it is shown--using a stylized model--that increases in corporate tax rate induce choice of income-increasing accounting treatments. Empirical results applying logit analysis to a sample of compensation data are consistent with this implication of the model.

The article discusses implications of budgets for motivation and behavior in the context of expectancy theory as developed in the psychology of motivation. The authors discuss how the expectancy model reconciles what might appear to be contradictory findings from prior studies. Budgets aid planning in that they incorporate forecasts which reflect the anticipated consequences of different combinations of plans made by management and the relevant uncontrollable events that may occur in the environment. The control function is typically a feedback process whereby information about past performance is provided to those who "control," to be utilized by them for making decisions. As a motivational tool, the budget conveys information to the subordinate about expectations of superiors regarding what constitutes successful task performance and the consequent reinforcement contingencies. The expectancy model is viewed as underlying the superior-subordinate budget relationship in two respects, as the model according to which the subordinate's motivation to perform the task is influenced via the budget; and as the model which the superior regards as determining the subordinate's motivation.

Presents a study which examined the implications of the report on accounting objectives (AICPA, 1973, called Report) to the reporting of extraordinary items. Trade-off between reliability and relevance; Framework for getting standards for the treatment of extraordinary items that are responsive to the accounting objectives as stated in the AICPA Study Group Report; Systematic path of inquiry that may be followed in the formulation of future accounting standards.

We use hand-collected data to analyze submission-to-acceptance (STA) times in the top-tier accounting journals relative to other top-tier business journals from 1993 through 2021. We find that, vis-à-vis other business disciplines, STA times at top-tier accounting journals were shorter in the first half of our sample period and significantly longer thereafter. We also observe shorter STA times for articles with authors from more highly ranked institutions; this effect exists only in top-tier accounting journals and has increased over time. In additional analyses, we find that our primary inferences are unchanged when considering maturity of initial journal submissions, journal-level democratization, and review process improvements related to paper quality. Our results should be of interest to researchers, journal editors, reviewers, provosts, deans, and tenure and promotion committees. Data Availability: The data used in this study are available from the sources indicated herein.