This paper investigates the academic conclusions on how CEO gender and salary affect firm value, while at the same time adding data on how CEO age affects firm value. Via an event study of S&P 500 CEO changes from 2000 to 2006 I confirm the current academic findings and discover that CEOs promoted during their 40s negatively influence firm value, while CEOs in older age brackets show a positive abnormal return on firm value. With this validation and addition to the existing data, firms and investors can more effectively assess proper candidates for the position of CEO and allocate resources accordingly.

This paper seeks to investigate the reaction of credit ratings and credit markets in response to accounting restatements. Accounting restatements can often be perceived as a precursor to fraudulent activity, which could lead to a more negative credit rating, or a heightened credit default swap (CDS) price. CDS prove to be a useful measuring tool as they adjust to changes relatively quickly; much more quickly than the assessment of a credit rating agency. My results suggest that restatements do indeed have an effect on credit rating. It does, however take longer for credit ratings to be updated after the restatement, but CDS quotes move faster and are just as, if not more accurate. I also find that credit default swaps do not anticipate restatements, showing that while the credit markets are beating the rating agencies, they do not appear to be beating the accountants.

It is an accepted fact that the Net Income of the Indianapolis Water Company was increased by the corporate refinancings of 1936 and 1946. However, no detailed study has been made, to date, to show the amount of the increase either in aggregate or in annual amounts. The writer thought such a study would be informative and interesting and the result of his study is presented herewith.

This paper examines CMBS loans originated from 2004 to 2007 in order to find the correct model specifications for loan default during the Great Recession. The data controls for loan-to-value, debt-service coverage ratio, debt-yield, loan rate, loan spread, term lengths, loan origination year, asset class, refinance or acquisition, and demographic data of state income and sales tax rates, state education spending per pupil, education rates by MSA, unemployment rates by MSA, and median household income by zip. The study affirms existing research that LTV and debt yield are significantly correlated with default probability, found a strong relationship between loan rate, but not spread on default, affirmed industry knowledge that lodging is generally the riskiest asset class, and found that education levels in an MSA can significantly explain loan default rates. There was limited significance in regression results for unemployment rates, education spending, and median income on default probability and no evidence of default correlation with sales or income taxes. The study also provides evidence that during economic bubbles with skewed assets valuations, debt-yield becomes a more useful metric compared to LTV.

Previous studies have concluded that mandatory audit firm rotation (MAFR) has not been successful in controlling the outcomes of the auditor-client relationship. Additionally, the literature concludes that high institutional ownership enhances audit quality through monitoring the management-auditor relationship. This paper hypothesizes that better corporate governance in terms of high institutional ownership percentage will enhance audit quality during a MAFR regime. Since countries that have implemented MAFR in the past have their data in their local languages, I use the special case of Arthur Andersen clients based in the US as my treatment group. I carry out a descriptive statistical analysis and run linear OLS regressions with discretionary accruals as a proxy for audit quality as my dependent variable. Results suggest that the percentage of institutional ownership does not have a significant impact on audit quality in a MAFR regime.

This paper utilizes a case study approach to explain the impact of having a franchise from the National Basketball Association (NBA) move to a city where a team from the four major American sports league had not existed on employment levels. This paper utilizes the synthetic control method to examine employment in Memphis, Oklahoma City, Orlando, Sacramento, and Salt Lake City. Applying the synthetic control method, this paper finds that employment is not impacted positively as the stadium proposals suggest they will when putting forth subsidy bids. Due to the large costs imposed on taxpayers as a result of the subsidies franchises receive, further research should be conducted to look at the impact of spending on public expenditures instead of stadiums and its impact on employment levels.

With the explosion of Bitcoin, various cryptocurrencies are beginning to garner incredible amounts of attention from speculators and institutional investors alike. Simultaneously, the rise in the number of occurrences of cyber ransom attacks has proven to be an increasingly relevant part of the conversation in the formative years of the Bitcoin ecosystem, as hackers demand payments be in the form of bitcoin. To test the relative impact of these different ransom events on the price of bitcoin, this paper conducts an event study to quantify the reaction by investors upon revelation of the news. In addition, it examines differences between Bitcoin and two other cryptocurrencies, Ethereum and Litecoin, to control for any liquidity effects of victims buying up large sums of bitcoin. The findings of the study indicate that following the ransom events there is a positive price reaction, supporting the claim that investors in Bitcoin generally perceive these events as good news. This could have a profound effect on the development and further adoption of cryptocurrencies, as regulators try to determine whether or not to intervene.

Microfinance for-profit organizations flooded the market in the early 2000's when microcredit demonstrated profitability. Ever since, an intense debate arose contesting the morality of profiting from the poor. Many for-profit micro finance institutions were accused of predatory lending through high interest rates and aggressive marketing and payment collection. In this paper, I examine the validity of the arguments for and against for-profits by extensively comparing the different target audiences of the charity sector and the private sector and the main arguments of each side. I conclude that, although the ability to serve the poor is compromised by profit motives, for-profit micro finance organizations are serving a different market - and a much needed one - than nonprofits. Therefore, for-profits serve a function that, as of right now, nonprofits are not able to.

Volatility is a fascinating and important topic for financial markets in general, and probably the single most important issue in financial risk management. Although volatility itself is not synonymous with risk, it is closely associated with it in the realm of risk management. In this study, I focus on the volatility in the foreign exchange markets and investigate the spillover of volatility from this market to equity correlations and its impact on global equity markets’ bid-ask spreads as a proxy for market quality. I also explore the role that accounting earnings quality play in subsequent volatility in U.S. equity markets. I provide a theoretical base and its associated empirics for the link between exchange rate volatilities and global equity correlations. I test this theory using multiple techniques that ends with the application of autoregressive error correction analysis, wherein, I demonstrate the predictive power of options implied exchange rate volatilities against ex-ante global equity correlations. My findings indicate that exchange rate implied volatilities, coupled with one-period ex-post correlations, are more predictive of subsequent equity market correlations than other models. I then examine the impact of currency volatilities on the average monthly spreads in ADRs and their underlying local shares. I employ dynamic panel data estimation and principal component analysis to show that currency volatility explains a significant portion (16.6%) of the variation in spreads across markets, heretofore largely unexplored by extant finance literature. Finally, I employ well established accrual measures to calculate aggregate accruals for the S&P 500 on a quarterly basis and examine the ability of this aggregate measure to forecast future trends in the volatility of the index. I find a statistically significant relation between subsequent twelve-month volatility in the S&P 500 index and aggregate accruals. This relation holds whether total or abnormal accruals measures are employed. My findings document a rare long-term indicator of volatility in the widely followed index. I also show that my aggregate accrual measure yields additional information about S&P 500 volatility when compared with simple historical volatility measures or option implied volatility.

A comprehensive examination of the differences in compensation and turnover between domestic and multinational firms in distress from 2003 - 2008 was completed. An examination of three major theories of turnover is examined within the boundaries of distressed firms and support is found for the Scapegoat Theory as proposed by Huson in 2004. The results found no significant differences between total compensation levels between domestic and international firms. And with turnover rates of 26 percent and 51 percent, these groups have only board size as a significant impacting variable.