时间：2016年12月2日（周五）10:00-11：30
地点：嘉庚二号楼501教室
题目：Understanding the Relation between Executives’ Incentives and Reported Performance
报告人：Zhonglan Dai, associate professor in accounting, University of Texas at Dallas
主持人：胡金帅，厦门大学财会研究院副院长，副教授
论文摘要：
A number of theoretical studies suggest that the board, in designing executives’ optimal incentives, must strike a balance between motivating value-adding activities and deterring non-productive performance manipulation activities when reported performance is used to motivate the executives. This paper provides the first empirical evidence on this important tradeoff. To do so, we decompose the executives’ incentives into predicted component (optimal incentives) and residual component (excess incentives). Similarly for reported earnings (ROA), we decompose it into real performance (discretionary accrual adjusted ROA) and managed performance (discretionary accruals or DA). We first show that without decomposition, incentives affect both ROA and DA positively. However, after decomposition, we find that only optimal incentives affect real performance positively while excess incentives affect only managed performance positively. Moreover, the optimal incentives from all top paid executives affect real performance, while only the excess incentives from CEOs and CFOs, not other top paid executives, affect managed performance. Cross-sectional analyses of corporate governance further show that better monitoring strengthens the impact the optimal incentives have on real performance, and in the meantime, weakens the impact the excess incentives have on managed performance. Finally, using AAER events as a proxy for earnings management, we find consistent results that only excess incentives increase accounting fraud probability and that better monitoring mitigates the relation between excess incentives and accounting fraud probability. Together, our results suggest that it is important to separate excess incentives from the optimal incentives in order to understand the relation between executives’ incentives and reported performance.
报告人简介：
Prof. Dai got her PhD from University of North Carolina at Chapel Hill. Her research interests include CEO turnover, CEO compensation, and Individual taxes capitalization. She has published papers in top journals such as Journal of Finance, Journal of Financial Economics, and Contemporary Accounting Research.