Executive pension, default risk, and earnings managementFootnote^*

* Accepted by Jeong-Bon Kim upon recommendation by Cheong H. Yi.

References

• Altman, Edward I. 1968. “Financial Ratios, Discriminant Analysis and the Prediction of Corporate Bankruptcy.” The Journal of Finance 23 (4): 589–609.10.1111/j.1540-6261.1968.tb00843.x
   Web of Science ®Google Scholar
• Armstrong, C. S., W. R. Guay, and J. P. Weber. 2010. “The Role of Information and Financial Reporting in Corporate Governance and Debt Contracting.” Journal of Accounting and Economics 50 (2–3): 179–234.10.1016/j.jacceco.2010.10.001
   Web of Science ®Google Scholar
• Ashbaugh, H., R. LaFond, and B. Mayhew. 2003. “Do Nonaudit Services Compromise Auditor Independence? Further Evidence.” The Accounting Review 78 (3): 611–639.10.2308/accr.2003.78.3.611
   Web of Science ®Google Scholar
• Bebchuk, L., and R. J. Jackson. 2005. “Executive Pensions.” Journal of Corporation Law 30: 823–855.
   Google Scholar
• Becker, C., M. Defond, James Jiambalvo, and K. Subramanyam. 1998. “The Effect of Audit Quality on Earnings Management.” Contemporary Accounting Research 15 (1): 1–24.10.1111/care.1998.15.issue-1
   Google Scholar
• Bergstresser, D., and T. Philippon. 2006. “CEO Incentives and Earnings Management.” Journal of Financial Economics 80 (3): 511–529.10.1016/j.jfineco.2004.10.011
   Web of Science ®Google Scholar
• Brockman, P., X. Martin, and Emre Unlu. 2010. “Executive Compensation and the Maturity Structure of Corporate Debt.” The Journal of Finance 65 (3): 1123–1161.10.1111/j.1540-6261.2010.01563.x
   Web of Science ®Google Scholar
• Burgstahler, D., and I. Dichev. 1997. “Earnings Management to Avoid Earnings Decreases and Losses.” Journal of Accounting and Economics 24 (1): 99–126.10.1016/S0165-4101(97)00017-7
   Web of Science ®Google Scholar
• Burns, N., and S. Kedia. 2006. “The Impact of Performance-Based Compensation on Misreporting.” Journal of Financial Economics 79 (1): 35–67.10.1016/j.jfineco.2004.12.003
   Web of Science ®Google Scholar
• Butler, M., A. J. Leone, and M. Willenborg. 2004. “An Empirical Analysis of Auditor Reporting and Its Association with Abnormal Accruals.” Journal of Accounting and Economics 37 (2): 139–165.10.1016/j.jacceco.2003.06.004
   Web of Science ®Google Scholar
• Cassell, C., S. Huang, J. Manuel Sanchez, and M. Stuart. 2012. “Seeking Safety: The Relation between CEO inside Debt Holdings and the Riskiness of Firm Investment and Financial Policies.” Journal of Financial Economics 103 (3): 588–610.10.1016/j.jfineco.2011.10.008
   Web of Science ®Google Scholar
• Choi, J. H., J. B. Kim, and Y. Zang. 2010. “Do Abnormally High Audit Fees Impair Audit Quality?” Auditing: A Journal of Practice & Theory 29 (2): 115–140.10.2308/aud.2010.29.2.115
   Web of Science ®Google Scholar
• Coles, J., N. Daniel, and L. Naveen. 2006. “Managerial Incentives and Risk-Taking.” Journal of Financial Economics 79 (2): 431–468.10.1016/j.jfineco.2004.09.004
   Web of Science ®Google Scholar
• DeAngelo, H., L. DeAngelo, and D. J. Skinner. 1994. “Accounting Choice in Troubled Companies.” Journal of Accounting and Economics 17 (1–2): 113–143.10.1016/0165-4101(94)90007-8
   Web of Science ®Google Scholar
• Dechow, P. M., and I. D. Dichev. 2002. “The Quality of Accruals and Earnings: The Role of Accrual Estimation Errors.” The Accounting Review 77 (s–1): 35–59.10.2308/accr.2002.77.s-1.35
   Web of Science ®Google Scholar
• Dechow, P. M., A. P. Hutton, J. H. Kim, and R. G. Sloan. 2012. “Detecting Earnings Management: A New Approach.” Journal of Accounting Research 50 (2): 275–334.10.1111/joar.2012.50.issue-2
   Web of Science ®Google Scholar
• DeFond, M. L., and J. Jiambalvo. 1994. “Debt Covenant Violation and Manipulation of Accruals.” Journal of Accounting and Economics 17 (1–2): 145–176.10.1016/0165-4101(94)90008-6
   Web of Science ®Google Scholar
• DeFond, M. L., and C. W. Park. 2001. “The Reversal of Abnormal Accruals and the Market Valuation of Earnings Surprises.” The Accounting Review 76 (3): 375–404.10.2308/accr.2001.76.3.375
   Web of Science ®Google Scholar
• DeFond, M. L., and K. R. Subramanyam. 1998. “Auditor Changes and Discretionary Accruals.” Journal of Accounting and Economics 25 (1): 36–67.
   Web of Science ®Google Scholar
• Edmans, A., and Q. Liu. 2011. “Inside Debt.” Review of Finance 15 (1): 75–102.10.1093/rof/rfq008
   Web of Science ®Google Scholar
• Francis, J., E. Maydew, and H. C. Sparks. 1999. “The Role of Big 6 Auditors in the Credible Reporting of Accruals.” Auditing: A Journal of Practice & Theory 18 (2): 17–34.10.2308/aud.1999.18.2.17
   Web of Science ®Google Scholar
• García Lara, J. M., B. G. Osma, and E. Neophytou. 2009. “Earnings Quality in Ex-Post Failed Firms.” Accounting and Business Research 39 (2): 119–138.10.1080/00014788.2009.9663353
   Web of Science ®Google Scholar
• Gul, F. A., and J. Goodwin. 2010. “Short-Term Debt Maturity Structures, Credit Ratings, and the Pricing of Audit Services.” The Accounting Review 85 (3): 877–909.10.2308/accr.2010.85.3.877
   Web of Science ®Google Scholar
• Hanlon, M., S. Rajgopal, and T. Shevlin. 2003. “Are Executive Stock Options Associated with Future Earnings?” Journal of Accounting and Economics 36 (1–3): 3–43.10.1016/j.jacceco.2003.10.008
   Web of Science ®Google Scholar
• Hayn, C. 1995. “The Information Content of Losses.” Journal of Accounting and Economics 20 (2): 125–153.10.1016/0165-4101(95)00397-2
   Web of Science ®Google Scholar
• Healy, P. 1985. “The Effect of Bonus Schemes on Accounting Decisions.” Journal of Accounting and Economics 7 (1–3): 85–107.10.1016/0165-4101(85)90029-1
   Web of Science ®Google Scholar
• Hribar, P., and D. Craig Nichols. 2007. “The Use of Unsigned Earnings Quality Measures in Tests of Earnings Management.” Journal of Accounting Research 45 (5): 1017–1053.10.1111/joar.2007.45.issue-5
   Web of Science ®Google Scholar
• Jensen, M. C., and W. H. Meckling. 1976. “Theory of the Firm: Managerial Behavior, Agency Costs and Ownership Structure.” Journal of Financial Economics 3 (4): 305–360.10.1016/0304-405X(76)90026-X
   Web of Science ®Google Scholar
• Jones, J. 1991. “Earnings Management during Import Relief Investigations.” Journal of Accounting Research 29 (2): 193–228.10.2307/2491047
   Web of Science ®Google Scholar
• Kalyta, P. 2009. “Accounting Discretion, Horizon Problem, and CEO Retirement Benefits.” The Accounting Review 84 (5): 1553–1573.10.2308/accr.2009.84.5.1553
   Web of Science ®Google Scholar
• Kasznik, R. 1999. “On the Association between Voluntary Disclosure and Earnings Management.” Journal of Accounting Research 37 (1): 57–81.10.2307/2491396
   Web of Science ®Google Scholar
• Kim, J. B., R. Chung, and M. Firth. 2003. “Auditor Conservatism, Asymmetry Monitoring and Earnings Management.” Contemporary Accounting Research 20 (2): 323–359.10.1506/J29K-MRUA-0APP-YJ6V
   Web of Science ®Google Scholar
• Kim, Y., M. S. Park, and B. Wier. 2012. “Is Earnings Quality Associated with Corporate Social Responsibility?” The Accounting Review 87 (3): 761–796.10.2308/accr-10209
   Web of Science ®Google Scholar
• Klein, A. 2002. “Audit Committee, Board of Director Characteristics, and Earnings Management.” Journal of Accounting and Economics 33 (3): 375–400.10.1016/S0165-4101(02)00059-9
   Web of Science ®Google Scholar
• Kothari, S. P., A. Leone, and C. Wasley. 2005. “Performance Matched Discretionary Accrual Measures.” Journal of Accounting and Economics 39 (1): 163–197.10.1016/j.jacceco.2004.11.002
   Web of Science ®Google Scholar
• Lambert, R. A., and D. F. Larcker. 1987. “An Analysis of the Use of Accounting and Market Measures of Performance in Executive Compensation Contracts.” Journal of Accounting and Research 25: 85–129.10.2307/2491081
   Web of Science ®Google Scholar
• Li, K., and N. Prabhala. 2007. “Self-Selection Models in Corporate Finance.” In Handbook of Corporate Finance, edited by Espen Eckbo, 37–86. Amsterdam: Elsevier-North Holland.
   Google Scholar
• Low, A. 2009. “Managerial Risk-Taking Behavior and Equity-Based Compensation.” Journal of Financial Economics 92 (3): 470–490.10.1016/j.jfineco.2008.05.004
   Web of Science ®Google Scholar
• McConnell, J. J., and H. Servaes. 1990. “Additional Evidence on Equity Ownership and Corporate Value.” Journal of Financial Economics 27 (2): 595–612.10.1016/0304-405X(90)90069-C
   Web of Science ®Google Scholar
• McNichols, M. F. 2000. “Research Design Issues in Earnings Management Studies.” Journal of Accounting and Public Policy 19 (4–5): 313–345.10.1016/S0278-4254(00)00018-1
   Google Scholar
• Menon, K., and D. D. Williams. 2004. “Former Audit Partners and Abnormal Accruals.” The Accounting Review 79 (4): 1095–1118.10.2308/accr.2004.79.4.1095
   Web of Science ®Google Scholar
• Moehrle, S. R. 2002. “Do Firms Use Restructuring Charge Reversals to Meet Earnings Targets?” The Accounting Review 77 (2): 397–413.10.2308/accr.2002.77.2.397
   Web of Science ®Google Scholar
• Morck, R., A. Shleifer, and R. W. Vishny. 1988. “Management Ownership and Market Valuation.” Journal of Financial Economics 20 (Jan.–Mar.): 293–315.10.1016/0304-405X(88)90048-7
   Web of Science ®Google Scholar
• Murphy, K. 1985. “Corporate Performance and Managerial Remuneration.” Journal of Accounting and Economics 7 (1–3): 11–42.10.1016/0165-4101(85)90026-6
   Web of Science ®Google Scholar
• Myers, S. C. 1977. “Determinants of Corporate Borrowing.” Journal of Financial Economics 5 (2): 147–175.10.1016/0304-405X(77)90015-0
   Web of Science ®Google Scholar
• Ohlson, J. 1980. “Financial Ratios and the Probabilistic Prediction of Bankruptcy.” Journal of Accounting Research 18 (1): 109–131.10.2307/2490395
   Web of Science ®Google Scholar
• Peltier-Rivest, D. 1999. “The Determinants of Accounting Choices in Troubled Companies.” Quarterly Journal of Business and Economics 38 (4): 28–44.
   Google Scholar
• Phan, H. V. 2014. “Inside Debt and Mergers and Acquisitions.” Journal of Financial and Quantitative Analysis 49 (5–6): 1365–1401.10.1017/S0022109014000593
   Web of Science ®Google Scholar
• Rosenbaum, P. R., and D. B. Rubin. 1983. “The Central Role of the Propensity Score in Observational Studies for Causal Effects.” Biometrika 70 (1): 41–55.10.1093/biomet/70.1.41
   Web of Science ®Google Scholar
• Rosner, R. L. 2003. “Earnings Manipulation in failing Firms.” Contemporary Accounting Research 20 (2): 361–408.10.1506/8EVN-9KRB-3AE4-EE81
   Web of Science ®Google Scholar
• Shipman, J. E., Q. T. Swanquist, and R. L. Whited. 2016. “Propensity Score Matching in Accounting Research.” The Accounting Review. Advance online publication.
   Google Scholar
• Subramanyam, K. R. 1996. “The Pricing of Discretionary Accruals.” Journal of Accounting and Economics 22 (1–3): 249–281.10.1016/S0165-4101(96)00434-X
   Web of Science ®Google Scholar
• Sundaram, R., and D. Yermack. 2007. “Pay Me Later: Inside Debt and Its Role in Managerial Compensation.” The Journal of Finance 62 (4): 1551–1588.10.1111/j.1540-6261.2007.01251.x
   Web of Science ®Google Scholar
• Sweeney, A. P. 1994. “Debt Covenant Violations and Managers’ Accounting Responses.” Journal of Accounting and Economics 17 (3): 281–308.10.1016/0165-4101(94)90030-2
   Web of Science ®Google Scholar
• Tucker, J. W. 2010. “Selection Bias and Econometric Remedies in Accounting and Finance Research.” Journal of Accounting Literature 29: 31–57.
   Google Scholar
• Watts, R., and J. Zimmerman. 1986. Positive Accounting Theory. New Jersey, NJ: Prentice Hall.
   Google Scholar
• Wei, C., and D. Yermack. 2011. “Investor Reactions to CEOs’ inside Debt Incentives.” Review of Financial Studies 24 (11): 3813–3840.10.1093/rfs/hhr028
   Web of Science ®Google Scholar