My research explores issues at the intersection of human capital, corporate strategy, and accounting. My recent projects focus on how human capital characteristics influence accounting outcomes. Earlier work examines how corporate strategy, particularly mergers and acquisitions, impacts the firm's use of accounting information. Additionally, I am interested in exploring the boundaries of the relevance and usefulness of financial reporting.

Published Works

How resilient are firms' financial reporting processes to the sudden loss of a CFO? Evidence from sudden deaths (with Sarah McVay) The Accounting Review, Forthcoming

We use the sudden deaths of CFOs as an exogenous shock to examine how resilient firms’ financial reporting processes are related to the sudden loss of a CFO. We find that when a CFO suddenly dies, the likelihood that the firm will experience an adverse financial reporting outcome—a subsequent restatement or late SEC filing—more than doubles. The effect of CFO deaths is larger for more complex firms, firms with weak internal control structures, and firms with less-educated rank-and-file employees. In contrast, we demonstrate that sudden CEO deaths have no discernible effect on these financial reporting outcomes, and less sudden CFO turnover events have a much smaller negative effect. Overall, our findings demonstrate that the sudden loss of a CFO has an immediate negative impact on financial reporting, which should provide boards with a lower-bound for the financial reporting benefits of CFO contingency plans.

Click here for the list of sudden CFO deaths.

Information spillovers at earnings announcements (with Richard Frankel and Bright Godigbe) Journal of Accounting Research 2024

Research documents price comovements or “spillovers” between focal firms and their peers at focal firms’ earnings announcements. We find that signed and absolute comovements between focal- and peer-firm returns are significantly lower at earnings-announcement dates compared to other dates. We further examine three settings where information transfers might be higher —when focal firms report significant earnings surprises, are industry leaders, or share correlated earnings patterns with peer firms—and consistently find reduced return correlation during focal-firm earnings announcements. These results raise questions about the size of the information externality of financial reporting.

Auditor skill demands and audit quality: Evidence from job postings (with Charles Ham, Rebecca Hann and Wenfeng Wang) Management Science 2024

This study empirically examines the relation between audit quality and auditors’ cognitive and social skills. Using a novel dataset of online job postings by accounting firms, we document substantial variation in the stated demand for auditors’ cognitive and social skills, suggesting that audit offices are not homogeneous in their preferences for such skills. We find a positive relation between audit quality and the prevalence of cognitive and social skills within an audit office’s job postings. This association is stronger for audit engagements that are more complex or require greater coordination, suggesting that cognitive and social skills are particularly important in engagements where effective communication and knowledge transfer, as well as sound professional judgement and skepticism, are needed. The association is also stronger for audit offices with greater investments in new technology, consistent with the complementary relation between cognitive and social skills and the use of technology. Overall, our study offers among the first empirical evidence linking specific auditor skills to audit quality.

Managers' affiliation ties and subordinates' inter-firm mobility: Evidence from large U.S. law firms (with Seth Carnahan and Jose Uribe) Organization Science 2022

We hypothesize that employee mobility between organizations will be lower when the organizations’ managers share affiliation ties. We test this idea by examining interorganizational employee mobility between large corporate law practices. We find that a practice area is less likely to hire attorneys from a rival practice area when the leaders of the two practice areas attended the same law school at the same time, our proxy for the presence of an affiliation tie. The negative relationship is stronger for hiring higher-ranked attorneys, and it is driven by practice leaders from the same law school class. Exploiting appointments of new practice leaders, we find a sharp and immediate decline in interorganizational mobility following an appointment that creates an affiliation tie between the leadership of the practice areas. While we cannot rule out the possibility that job seekers’ preferences drive the results, we conclude that rival managers’ ties deserve further scrutiny because they might limit the outside employment opportunities of their subordinates.

Happy analysts (with Ole-Kristian Hope, Congcong Li and An-Ping Lin) Accounting, Organizations and Society 2021

This paper is the first to investigate the role of work-life balance in financial analysts’ performance and career advancement. Using a large sample of Glassdoor reviews by financial analysts, we find a significant non-linear relation between perceived work-life balance and analyst performance and analyst career advancement. Specifically, when perceived work-life balance is relatively low, an increase in work-life balance is associated with better analyst performance and career advancement; however, when perceived work-life balance is already high, a further increase in work-life balance is associated with worse analyst performance and career advancement.

Value is in the eye of the beholder (sole-authored) The Accounting Review 2018

Gupta and Gerchak (2002) argue that different acquirers can arrive at different equity valuations for the same target depending on their strategic intent. A reason for acquirers' equity valuations to vary, holding target fundamentals constant, may be that individual acquirers place different weights on underlying fundamentals. I examine this possibility using Burgstahler and Dichev's (1997) theoretical framework. They argue that the relative importance of earnings and book value depends on expected adaptation, which is the likelihood that the existing earnings generating process will be altered. Using restructuring costs to proxy for expected adaptation at the individual acquirer level, I find that the association between the target's earnings (book value) and acquirers' bid prices is decreasing (increasing) in expected adaptation, consistent with theoretical predictions. These findings are less pronounced during merger waves and intense bid competition for the target.

Acquisition motives and the distribution of acquisition performance (sole-authored) Strategic Management Journal 2017

I examine how acquisition motives relate to the distribution of post-acquisition performance. I argue that acquisitions motivated by operating synergies have the potential to experience greater gains than acquisitions driven by financial synergies but are harder to value and implement, making them more uncertain. Using SEC filings, conference calls and press releases to capture acquisition motives, I find that acquirers pursuing operating synergies are more likely to experience highly positive and highly negative long-term returns than acquirers pursuing financial synergies. I also find that acquisition experience and geographic proximity to targets soften acquirers' extreme downside outcomes in operating synergy acquisitions. My theory and results suggest that approaches that emphasize average outcomes for acquirers and use industry classifications to capture acquisition motives may be incomplete.

Working Papers

Capital Market Pressure and Racial Inequality: An Examination of Workplace Safety and Wage Theft (with Seth Carnahan and Sarah McVay) Minor Revision at The Accounting Review

Managers generally face capital market pressure to report higher earnings, especially when doing so allows them to meet an earnings benchmark. Cost-cutting strategies to increase earnings, such as pressuring employees to work at unsafe speeds or off the clock to increase production, also increase the likelihood of safety violations and wage theft. We examine whether these incidents—which benefit the firm’s managers and shareholders to the detriment of the employees—are evenly distributed across low-wage frontline employees. We predict and find that within low-wage frontline employees, non-white frontline employees are at greater risk, on average, of facing unsafe work environments and wage theft, and this risk increases even further when their employer is under heightened capital market pressure to meet an earnings benchmark. We conclude that capital market pressure appears to have a disproportionate impact on non-white employees, increasing racial inequality in the workplace through safety violations and wage theft.

Without a Word of WARN-ing: Advance Notice, the Information Environment, and Labor Market Outcomes (with Sara Malik) Second round review at The Journal of Labor Economics

This paper examines the effect of mandated advance notice on displaced workers’ short-term and long-term labor market outcomes. The impact is theoretically ambiguous: while advance notice mechanically increases job search time before displacement, it may also reduce both aggregate employment and the marginal incentive to search for new employment. Using the staggered adoption of U.S. advance notice laws between 2003 and 2017 and worker-level data, I find that advance notice is associated with a five percentage point reduction in joblessness incidence immediately after displacement. My analyses show that these short-term benefits accrue unevenly to displaced workers: women benefit more than men and skilled workers benefit more than un- skilled workers. Separately, I find a three percentage point increase in long-term labor force participation and a three percentage point increase in long-term re-employment. Using an online, randomized field survey, I find evidence that the improved long-term labor market outcomes are attributable to a reduction in the discouraged worker effect. Throughout the paper, I highlight when my results refute or overturn results in the prior literature. Overall, my results suggest that advance notice benefits displaced workers.

Works in Progress

Firms’ Internal Information Systems and the Wages of Female and Black Workers  (with Seth Carnahan) 

This study explores the association between higher-quality internal information systems and gender and race wage gaps in organizations. Using U.S. Census microdata on plant management practices and worker compensation, our initial results show smaller gender wage gaps in establishments with higher-quality internal information systems. We explore two potential explanations. First, better internal information systems may allow female workers to better understand the organization’s performance targets, increasing their productivity and, hence, their pay. Second, better internal information systems may provide managers with more data on workers’ productivity, potentially reducing the role of statistical discrimination related to gender in pay decisions. The results provide some evidence of smaller race wage gaps in establishments with stronger internal information systems, but these results are driven by worker sorting. 

The Information Content of 10-K and 10-Q Amendments  (with Sarah McVay and Simmi Mookerjee) 

Amendments to Forms 10-K and 10-Q—filed as 10-K/As and 10-Q/As—are a routine but underexamined component of SEC disclosure. Although typically viewed as administrative, a meaningful share contain revisions with implications for financial reporting quality. Using large language models (LLMs), we classify the full population of amendment filings from EDGAR into two groups: those addressing procedural issues (low salience) and those correcting accounting errors or adding information relevant to the financial statements or internal controls (high-salience). Approximately 31 percent of amendments fall into the high-salience category, capturing a broader range of reporting issues than identified by common datasets like Audit Analytics. By moving beyond GAAP misapplications to include omissions, compliance breakdowns, and control-related disclosures, we provide a more complete view of the financial reporting error landscape. We find that firms issuing any type of amendment are significantly more likely to file a Big R restatement within the next year, and the association more than doubles when considering only high-salience amendments. Amendments involving internal control disclosures also significantly predict future material weakness disclosures. These findings extend existing frameworks of reporting quality and highlight amendments as a valuable disclosure channel.