I investigate whether a firm’s social capital with investors impacts its non-GAAP reporting decisions. Critics of non-GAAP reporting suggest that non-GAAP earnings are incomplete, inaccurate, and can be misleading (Derby, 2001; Dreman, 2001; Elstein, 2001; Black et al., 2007). Firms might be hesitant to provide non-GAAP information if other means are available to transfer information. Social capital provides an alternate method of informing investors. However, social capital might also play another role in the information environment by building trust between managers and investors (Gabarro, 1978; Gulati, 1995). This trust may reduce investor skepticism of non-GAAP information, enhancing the value of non-GAAP disclosures. Additionally, I examine what impact social capital might have on investors’ investment decisions with respect to non-GAAP reporting. Despite critics’ concerns over non-GAAP reporting, prior literature suggests investors’ reactions are more aligned with the non-GAAP definition of earnings (Bradshaw and Sloan, 2002; Bhattacharya et al., 2003), suggesting other factors might influence investors’ decisions. I investigate whether social capital plays a role in reducing skepticism in non-GAAP information leading to reduced information asymmetry and increased investor reaction to non-GAAP disclosures. I find that non-GAAP reporting is increasing in social capital with investors. However, I find no evidence that investor reactions to non-GAAP earnings information differ based on firms’ social capital with investors. I also find information asymmetry around earnings announcements is higher for non-GAAP reporting firms with greater social capital with investors in comparison to non-GAAP reporters with lower social capital. Taken together, my results suggest social capital impacts the decisions of firms in reporting non-GAAP earnings information, but not the decisions of investors. My results are relevant to the current disclosure environment in that non-GAAP reporting is a current topic of interest for regulators with several updates to non-GAAP guidance having recently occurred. / Includes bibliography. / Dissertation (Ph.D.)--Florida Atlantic University, 2019. / FAU Electronic Theses and Dissertations Collection

D. Litt. et Phil / The study focuses on the role of social capital in socio-economic development in developing political economies. While the concept of social capital originated as a sociological construct focusing on social relations, the theoretical debate has recently developed towards a grounding in political science, political development and political economy. Despite these advancements, a universally accepted definition has not been arrived at. However, there is consensus regarding the elements of social capital, which include norms, networks, institutions, relationships, civic engagement, membership of voluntary associations, trust, reciprocity and altruism. Dimensions of social capital include the structural and the cognitive, and types include bonding, bridging and linking social capital. This study examines the role of linking social capital, specifically in facilitating the relationship between state and society, aimed at mutual benefit. Social capital is regarded as a resource, particularly in communities with limited or no access to other, more traditional forms of capital. Operationalisation of social capital is examined by means of a comparative and analytical review of existing indexes, case studies and surveys. In this regard, initiatives in both developed and developing political economies are examined. The study emphasises the multi-disciplinary nature of social capital and propagates its value in socio-economic development. Empirical data that confirm the relationship between social capital and economic growth are presented. Initiatives to contribute to the development of conceptual frameworks and to increase and improve qualitative data are assessed, in order to determine the contribution of social capital to socio-economic development. In this regard, particular emphasis is placed on the important contribution of the World Bank’s Social Capital Initiative. The literature emphasises the interdependence of politics and economy and the study highlights the need for a political economy approach to socio-economic development. In this regard, the development initiatives of various multi-lateral development agencies are examined. The focus is on the current trend to follow a political economy approach to country strategies, programmes and projects aimed at achieving socio-economic development. The study concludes that social capital is a valuable element in this regard and argues that political economy analysis tools are well placed to integrate social capital in a multi-disciplinary approach to address poverty and socio-economic development challenges.