We consider how images (i.e., photos but not graphs, charts, or infographics) in annual reports provide users with information and use machine-learning algorithms to assess their informativeness. We develop a metric of content reinforcement, defined as the degree to which information investors extract from images complements and reinforces details in textual narratives. We find that firms are more likely to use images when they experience greater asset growth, have greater business complexity, and provide less readable textual disclosures—suggesting images are used more often when information processing costs are high. Our main results indicate that increases in visual prevalence and the extent to which images reinforce text are associated with greater analyst forecast accuracy and lower dispersion, suggesting that images improve users’ information processing. Firms also increase image use after an exogenous decline in analyst coverage. Overall, firms use images when their information environment is poorer, and visual informativeness facilitates information assimilation.

Although recent evidence suggests that individual audit partners explain a substantial portion of the variation in audit quality proxies, much less is known about what determines an audit partner's quality. Psychology and behavioral economics theories hold that an individual's experiences can have enduring impacts on subsequent behavior. We examine whether auditors' direct exposure to Arthur Andersen's collapse has a long‐term impact on the quality of their audits. Our evidence implies that audit partners who directly experienced Andersen's demise impose stricter monitoring evident in their clients exhibiting a lower propensity for misstatements and small profits, and paying higher audit fees. Importantly, these findings reconcile with research in finance and economics implying that firsthand experiences matter more to subsequent behavior than general economic conditions or secondhand or thirdhand experiences. Collectively, the results shed light on one facet of how partners' audit quality evolves over time. Our findings suggest that major failures associated with the audit firm in which an auditor works can ultimately result in these affected individuals later delivering higher audit quality, which should benefit audit committees in partner selection decisions and audit firms in designing partner assignment policies.