Relative performance evaluation, Project selection, Executive compensation, Agency theory

This paper constitutes a historical study of the roots of the decision by Arthur Andersen & Co. in 1946 to adopt a two‐part auditor's opinion for all of its engagements, and of its eventual decision in 1962 to return to the standard form of the auditor's report. The essence of the two‐part opinion was to decouple the auditor's opinion on fairness of presentation from the opinion on conformity with generally accepted accounting principles. The paper also treats the factors that prompted the Canadian Institute of Chartered Accountants to adopt a two‐part opinion, and the reasons why it opted to return to the single‐opinion format in 1976. Résumé. L'auteur retrace l'historique de la décision prise en 1946 par Arthur Andersen & Cie de présenter l'opinion du verificateur en deux volets dans toutes ses missions, et de sa décision ultérieure, en 1962, de ramener le rapport du vérificateur à sa forme standard. Le choix de l'opinion en deux volets reposait sur l'intention de distinguer l'opinion du vérificateur quant à la fidélité avec laquelle est présentée l'information de l'opinion du vérificateur relative au respect des principes comptables généralement reconnus. L'auteur traite également des facteurs qui ont amené l'Institut Canadien des Comptables Agréés à adopter l'opinion en deux volets, et des raisons pour lesquelles il a choisi de rétablir l'opinion unique en 1976.

This paper investigates the effect of increased import competition on U. S. manufacturing employment and wages, using data for a panel of manufacturing industries over the 1977–1987 period. The empirical analysis uses previously unavailable industry import price data and an instrumental variables estimation strategy. The estimates suggest that changes in import prices have a significant effect on both employment and wages. The dramatic appreciation of the dollar between 1980 and 1985 is estimated to have reduced wages by 2 percent, and employment by 4.5–7.5 percent on average in this sample of trade-impacted industries.

There is now a large literature that attributes the investment decline in heavily indebted countries to the effects of the international debt crisis which began in 1982. However, these countries also faced falling export prices and high world real interest rates in the early 1980s, and these shocks could have directly caused investment to decline. One way to test for debt effects is to see whether equations without any debt-related information can nevertheless forecast the investment declines that these countries experienced. This paper shows that such equations can forecast investment in many indebted countries, and thus casts doubt on many debt-related explanations for the investment declines. I.

We estimate the conditional distribution of trade-to-trade price changes using ordered probit, a statistical model for discrete random variables. This approach recognizes that transaction price changes occur in discrete increments, typically eighths of a dollar, and occur at irregularly-spaced time intervals. Unlike existing models of discrete transactions prices, ordered probit can quantify the effects of other economic variables like volume, past price changes, and the time between trades on price changes. Using 1988 transactions data for over 100 randomly chosen U.S. stocks, we estimate the ordered probit model via maximum likelihood and use the parameter estimates to measure several transaction-related quantities, such as the price impact of trades of a given size, the tendency towards price reversals from one transaction to the next, and the empirical significance of price discreteness.

Charles E. Boynton, Paul S. Dobbins, George A. Plesko, Earnings Management and the Corporate Alternative Minimum Tax, Journal of Accounting Research, Vol. 30, Studies on Accounting and Taxation (1992), pp. 131-153

Myron S. Scholes, G. Peter Wilson, Mark A. Wolfson, Firms' Responses to Anticipated Reductions in Tax Rates: The Tax Reform Act of 1986, Journal of Accounting Research, Vol. 30, Studies on Accounting and Taxation (1992), pp. 161-185

James A. Ohlson, Pervin K. Shroff, Changes versus Levels in Earnings As Explanatory Variables for Returns: Some Theoretical Considerations, Journal of Accounting Research, Vol. 30, No. 2 (Autumn, 1992), pp. 210-226

Preferred Stocks, Foreign Tax Credits, Tax Reform Act, Tax burden