Publications:
Other Comprehensive Income, Its Components, and Analysts’ Forecasts (ssrn)
Embedded Files
Coauthored with Josh Anderson, Yiting Cao, and Eddie Riedl
Review of Accounting Studies, 28, 792–826 (June 2023)
Presented at 2018 Journal of Accounting, Auditing and Finance Conference, the 2018 AAA Western Region Meeting, and Boston University
Abstract This paper examines how analysts incorporate other comprehensive income (OCI) and its component elements into their earnings forecasts. We first document that analysts’ one-year ahead earnings forecasts are associated with OCI and OCI components having predictive ability; this suggests analysts (at least partially) incorporate this information into their forecasting activities. We then provide evidence that analysts are neither complete nor timely in incorporating OCI information into their forecasts, as several OCI components remain associated with analysts’ forecast errors. Further, we document that higher uncertainty in firm performance exacerbates analysts’ underreaction, evidencing a friction to full incorporation of OCI-related information. Finally, as evidence of where and when analysts derive OCI-related information, we document that analysts’ forecast revisions correlate with the release of firms’ 10-Ks and early 10-Qs (i.e., Q1 and Q2, but not Q3).
Management Science, Volume 71, Issue 3, 1865-1888 (March 2025)
Best Paper Award - 2019 AAA Northeast Region Meeting
SSRN Top Ten Download List: Advertising (Topic), Managerial Marketing eJournal
Featured in UNH Today, The Marketing Architects Podcast
Presented at 2019 Northeast Regional AAA Meeting, 2021 Hawaii Accounting Research Conference, 2022 Haskayne and Fox Accounting Conference, Boston University, Cal State University at Fullerton, George Mason University, George Washington University, Penn State University at Erie, Southern Methodist University, The Chinese University of Hong Kong – Shenzhen, The Hong Kong Baptist University, The Hong Kong Polytechnic University, The University of Science and Technology of China, University of New Hampshire, University of Rhode Island, and University of Washington
Abstract This paper examines how different advertising categories are associated with attributes of brand asset recognition arising in the context of acquisitions. Prior research documents that aggregate advertising is positively associated with firm sales and brand values, but fails to consider major recent shifts in advertising from traditional channels (such as TV) to digital advertising (such as paid search and online display). Using proprietary data, I decompose advertising expenditures into the categories of traditional, online display, and paid search. Consistent with expectations, results confirm that target firms’ traditional and online display advertising exhibit a higher likelihood of brand asset recognition and higher recognized brand values, as compared to paid search advertising. Confirming the economic substance of the recognized brands, additional results reveal positive investor equity market reactions to brand value, which are driven by firms investing more in traditional and online display advertising. Overall, these results confirm that certain advertising channels exhibit stronger associations with the recognition and characteristics of the underlying brand asset, consistent with their heterogeneous properties.
Working Papers:
Counterpoised Disclosure: Evidence from the Biotechnology Industry
Coauthored with Luminita Enache, Lynn Li, and Eddie Riedl
Best Paper Award - 2021 European Institute for Advanced Studies in Management - Intangibles and Intellectual Capital
Presented at 2022 European Accounting Association Annual Meeting, 2021 AFAANZ, Bentley University, BI Norwegian Business School, 2022 Burton Accounting Research Conference at Columbia University, 2021 Canadian Accounting Association Annual Meeting, Deakin University, 2021 European Accounting Symposium for Young Scholars (EASYS), University of Bristol, University of Leeds, Monash University, University of New Hampshire, Saint Mary’s University, University of Southern California, University of Washington, and Warwick Business School
Abstract This paper examines the causes and effects of counterpoised disclosures, defined as a concurrent, voluntary release of information intended to mitigate adverse consequences of a mandatory disclosure. To capture mandated disclosures, we use the setting of 8-Ks issued by biotechnology firms to disclose material milestones of a drug’s development, such as product-specific regulatory decisions by the Food and Drug Administration (FDA). We formulate and empirically support three predictions. First, we document that managers are more likely to include counterpoised disclosure—specifically, information about other drugs under development—in 8-Ks revealing negative mandatory information (such as a drug’s rejection by the FDA) relative to 8-Ks revealing positive mandatory information (such as a drug’s approval by the FDA). Second, we confirm that negative market reactions to the release of the 8-Ks with negative signals are attenuated for those providing counterpoised disclosures. Third, we provide evidence that counterpoised disclosure represents credible signals consistent with informational (as opposed to opportunistic) motivations, as drugs receiving this disclosure treatment exhibit higher ex post likelihood of subsequent FDA approval relative to drugs that do not.
Turning Invisible: Advertising Strategy after ESG Violation Penalty
Coauthored with Estelle Sun
Presented at 2023 Haskayne and Fox Accounting Conference, 2024 Journal of International Accounting Research Conference, 2024 Journal of Accounting, Auditing, and Finance ESG Symposium and Boston University
Abstract This paper examines how firms respond to reputation-damaging environmental, social, and governance (ESG) events through their advertising strategies. Using data on ESG violation penalties and monthly paid search advertising from 2014 to 2018, we find that firms show lower abnormal advertising expenditures in the month following such penalties. This reduction in advertising expenditures helps decrease consumer attention as well as investor attention. Further analysis indicates that financial constraints are unlikely to be the primary reason for the decrease in advertising activities. Overall, our findings suggest that after receiving ESG violation penalties, firms strategically use advertising to manage negative attention for both consumers and investors.
Attending to Then and Tomorrow: Executive Temporal Focus and Financial Reporting Outcomes
Coauthored with Jianhong Chen and Le (Emily) Xu
Presented at 2024 AAA Annual Meeting
Abstract We examine the effect of executive temporal focus on financial reporting outcomes. Temporal focus is a cognitive characteristic, referring to the degree to which individuals allocate their attention across past, present, and future. Specifically, we determine the collective temporal focus of executives, as a team, at a firm as top executives interact with each other to develop collective temporal orientations that guide their strategic choices. We then examine the effect of the collective executive temporal focus on financial reporting outcomes, i.e. financial reporting quality and earnings smoothness. Using past- and future-focused words in the scripted part of quarterly conference call transcripts, we find that firms with more (less) past focused executives have higher (lower) quality of financial reporting and more (less) smooth earnings. Further, firms with more (less) future focused executives have lower (higher) quality of financial reporting and less (more) smooth earnings. These results are robust when using alternative measures of financial reporting outcomes and controlling endogeneity. Lastly, we find that better external monitoring reduces the effect of executive temporal focuses on financial reporting outcomes. Our results contribute to the stream of research showing that executive characteristics affect financial reporting.
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