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Cost containment in the office is becoming more important secondary to increasing overhead costs and lower reimbursement. In an attempt to limit these particular expenditures we analyzed and restructured our methods of ordering, storing... more
Cost containment in the office is becoming more important secondary to increasing overhead costs and lower reimbursement. In an attempt to limit these particular expenditures we analyzed and restructured our methods of ordering, storing and distributing office supply inventory. In a large academic practice with 11 urologists and approximately 20,000 annual patient visits an attempt was made to decrease overhead costs using the principle of just in time inventory popularized by large manufacturing companies. We initially issued a return of excess and/or unused supplies from our office inventory stock room. Our main supply room was then centralized to contain office supplies for up to 4 weeks. The 12 individual clinic rooms were stocked with appropriate supplies to last 1 week. Limited access to the main supply room was established and a supply manager was established to log all input and output. The initial credit for the return of unused/overstocked supplies was $10,107 in January 2004. Annual office supply charges in calendar year 2004 were $87,444 compared to charges in calendar year 2003 of $175,340. No stock outs occurred during year 2004 and all standing delivery orders were terminated. The total number of patient visits in calendar year 2004 was 20,170 compared to 19,455 in calendar year 2003. Decreasing overall inventory through accurate demand forecasting, judicious accounting, office supply centralization and just in time ordering is a potential area for significant overhead cost savings in a clinical practice.
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ABSTRACT We analyze acquirers' wealth maximizing acquisition strategy when competing for a target. We allow acquirers to make either one-tier or two-tier offers. We show that a two-tier offer strategy will be used when target... more
ABSTRACT We analyze acquirers' wealth maximizing acquisition strategy when competing for a target. We allow acquirers to make either one-tier or two-tier offers. We show that a two-tier offer strategy will be used when target shareholders have sufficiently large differences in their valuations of the considerations offered, for example due to taxes. However, when shareholder heterogeneity is small, one-tier offers always defeat two-tier offers. Our model also explains the stylized fact that successful two-tier offers are over-subscribed (i.e., structured such that the number of shares tendered exceeds the number sought). Finally, for intermediate levels of valuation heterogeneity neither one- nor two-tier offers are uniquely optimal and acquirers will randomize their offer strategies or resort to preemptive offers, that is, offers that exceed the reservation value of their opponent. The latter is more likely to occur when the difference between the two acquirers' reservation values is high.
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In this paper we test whether the security price reaction around equityfor-debt swaps is related to contemporaneous changes in investors' earnings expectations. In an equity-for-debt swap, a company exchanges a portion of its debt for... more
In this paper we test whether the security price reaction around equityfor-debt swaps is related to contemporaneous changes in investors' earnings expectations. In an equity-for-debt swap, a company exchanges a portion of its debt for newly issued equity. Swaps have no impact on current cash flows and only a negligible impact on future cash flows and do not imply changes in investment policies.1 Consequently, security price changes around the swap announcement date cannot be attributed to changes in investment policies and swaps provide a setting for testing information effects associated with these leverage-decreasing transactions. Empirical studies document that leverage-decreasing transactions are
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Research Interests: Philosophy of Agency, Research Design, Accounting, Applied Economics, Social Science Research Network, and 10 moreEmpirical Research, Accounting Research, Voluntary disclosure, Agency Costs, Market Imperfection, Structuring, Information Asymmetry, Capital Market, Accounting Economics, and Externality
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I develop a benchmark for evaluating whether fair values disclosed by banks differ from investors' estimates of the market value of financial assets and liabilities. Using this benchmark, I conclude that the hypothesis that... more
I develop a benchmark for evaluating whether fair values disclosed by banks differ from investors' estimates of the market value of financial assets and liabilities. Using this benchmark, I conclude that the hypothesis that disclosed fair values closely approximate investors' estimates should be rejected. I present evidence suggesting that the procedure used in establishing fair values results in an understatement
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The paper "Capital Market Analysis of Reserve Recognition Accounting" investigates the association between firm values and asset values for a set of oil and gas firms. This association is tested by regressing the value of the... more
The paper "Capital Market Analysis of Reserve Recognition Accounting" investigates the association between firm values and asset values for a set of oil and gas firms. This association is tested by regressing the value of the firm (and the annual change in firm value) on the value of the firm's oil and gas reserves (and the annual change of its reserve values, respectively). Using the Hotelling principle, the paper derives the theoretical value of the regression coefficients. The value of the firm is defined as the market value of its equity plus the book value of its debt. For each company, reserve values are collected from two sources. First, data are collected from SEC disclosures following the requirements set forth in ASR No. 253. Second, reserve data are also collected from J. S. Herold. The results indicate that the estimated coefficients are significantly different from zero but deviate considerably from their theoretical values. The comments made by conference participants are organized into three sections. First, questions regarding measurement of the variables are presented. Second, comments regarding specification of the empirical tests are discussed. Finally, concluding comments are noted.
Research Interests: Economics and Accounting
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Research Interests: Business, Economics, Monetary Economics, Capital Markets, Corporate Finance, and 15 moreApplied Economics, Capital Investment, Profitability, Statistical Significance, Market efficiency, Earnings, Stock Price, Cash Flow, Stock Returns, Accruals, Capital Market, Accrual Basis, Accounting Economics, Profitability Index, and External Financing
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ABSTRACT Considering the voluminous published research confirming and extending the original findings of Cohen, Dey, and Lys (2008), we conclude that Pincus, Wu, and Hwang (2022) make a modest contribution to the earnings management... more
ABSTRACT Considering the voluminous published research confirming and extending the original findings of Cohen, Dey, and Lys (2008), we conclude that Pincus, Wu, and Hwang (2022) make a modest contribution to the earnings management literature. Specifically, their analysis does not incorporate recent advances in the earnings management literature, especially the measurement and estimation of real earnings management activities and the incorporation of the changing information environment. As a result, we conclude that the Pincus et al. (2022) results and conclusions with regards to the substitution between accrual-based and real earnings management activities should be interpreted with caution. JEL Classifications: G10; M4.
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... Deer, RE, 1978, The lawyer's basic corporate practice manual, Joint Committee on Continuing Professional Education of the American Law Institute and the American ... Dyckman, TR and AJ Smith, 1979, Financial accounting and... more
... Deer, RE, 1978, The lawyer's basic corporate practice manual, Joint Committee on Continuing Professional Education of the American Law Institute and the American ... Dyckman, TR and AJ Smith, 1979, Financial accounting and reporting by oil and gas producing companies ...
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... forecasts where no corporate accounting disclosures occurred between two consecutive forecastrelease dates, we estimate: 2 dFEPS;jt=ypi+yI,RRP ... 30 562 18.73 9.00 Columbia Gas 24 328 13.67 15.50 Communications Satellite 26 356 13.69... more
... forecasts where no corporate accounting disclosures occurred between two consecutive forecastrelease dates, we estimate: 2 dFEPS;jt=ypi+yI,RRP ... 30 562 18.73 9.00 Columbia Gas 24 328 13.67 15.50 Communications Satellite 26 356 13.69 12.00 Consolidated Edison of NY ...
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ABSTRACT We investigate whether US Generally Accepted Accounting Principles (GAAP) allows form to override substance. Based on our analysis, we conclude that GAAP, as practiced by the Securities and Exchange Commission (SEC), requires the... more
ABSTRACT We investigate whether US Generally Accepted Accounting Principles (GAAP) allows form to override substance. Based on our analysis, we conclude that GAAP, as practiced by the Securities and Exchange Commission (SEC), requires the accounting of a transaction to faithfully reflect its economic substance except for a few limited instances where there is an authoritative accounting pronouncement with bright-line rules. There are several SEC rules and releases that state this requirement, but more importantly, the SEC has brought actions against violators of the principle so that there is direct evidence that substance-over-form violations are not allowable in the US. We discuss this evidence in detail and provide preliminary empirical analysis.
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... Page 6. Acknowledgements The editor and publisher wish to thank the following who have kindly given permission for the use of copyright material. ... His directness and attacks could be brusque and, if you were the focus of such a... more
... Page 6. Acknowledgements The editor and publisher wish to thank the following who have kindly given permission for the use of copyright material. ... His directness and attacks could be brusque and, if you were the focus of such a barrage, the result would often serve at ...
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Margaret A. Neale, Thomas Z. Lys - Getting (More of) What You Want_ How the Secrets of Economics and Psychology Can Help You Negotiate Anything, in Business and in Life-Basic Books (2015)
... Lys, Thomas Z., Ramesh, K. and Thiagarajan, S. Ramu, The Role of Earnings Levels vs. Earnings Changes in Explaining Stock Returns: Implications from the Time Series Properties of Earnings (April 7, 1998). Available at SSRN:... more
... Lys, Thomas Z., Ramesh, K. and Thiagarajan, S. Ramu, The Role of Earnings Levels vs. Earnings Changes in Explaining Stock Returns: Implications from the Time Series Properties of Earnings (April 7, 1998). Available at SSRN: http://ssrn.com/abstract=84229. ...
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Almost every interaction involves negotiation, yet we often miss the cues that would allow us to make the most of these exchanges. In Getting (More of) What You Want, Margaret Neale and Thomas Lys draw on the latest advances in psychology... more
Almost every interaction involves negotiation, yet we often miss the cues that would allow us to make the most of these exchanges. In Getting (More of) What You Want, Margaret Neale and Thomas Lys draw on the latest advances in psychology and economics to provide new strategies for anyone shopping for a car, lobbying for a raise, or simply haggling over who takes out the trash. Getting (More of) What You Want shows how inexperienced negotiators regularly leave significant value on the table--and reveals how you can claim it.
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Monetary Theory and Monetary Policy is the second collection of essays by Karl Brunner – one of the most prominent economists of the twentieth century. It demonstrates the importance of economic analysis for the development of... more
Monetary Theory and Monetary Policy is the second collection of essays by Karl Brunner – one of the most prominent economists of the twentieth century. It demonstrates the importance of economic analysis for the development of appropriate economic policies.
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Abstract This paper argues that audit firms achieve competitive advantages through specialization, and that clients purchase audit services from the least cost supplier. Client-auditor realignments thus represent efficient responses to... more
Abstract This paper argues that audit firms achieve competitive advantages through specialization, and that clients purchase audit services from the least cost supplier. Client-auditor realignments thus represent efficient responses to changes in client operations and activities over time. Results obtained from analyzing the financial characteristics and share price performance of corporations that changed auditors between 1973 and 1982 support the view that realignments can generally be attributed to cross-temporal changes in client characteristics and differences in audit firm cost structures.