ORCID Profile
0000-0001-9290-0994
Current Organisation
Massey University
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Publisher: Informa UK Limited
Date: 12-1992
Publisher: Wiley
Date: 09-2000
Publisher: Wiley
Date: 12-2000
Publisher: SAGE Publications
Date: 04-2005
DOI: 10.1177/0148558X0502000204
Abstract: Napster released its controversial peer-to-peer music file sharing software to the public in June 1999, and after approximately two years of intense debates and legal battles it was eventually ordered to shut down in February 2001. The opponents of Napster (e.g., the Recording Industry Association of America, RIAA, and Metallica Lars Ulrich) suggested that Napster had collapsed the business structure of the U.S. multibillion-dollar music industry. Napster, on the other hand, argued that its service had increased the music sales. We use Napster as a proxy for diffuse piracy through the Internet since it was the conduit for in idual file sharing on a large scale. We examine the effects of 11 prominent Napster-related events on the equity value of firms in the U.S. music industry. If Napster's service stimulated (harmed) music sales, then events that increased (decreased) the effectiveness of Napster would improve (reduce) the stock prices of the music firms. Our evidence suggests that events that increased the effectiveness of Napster as a distribution mechanism improved the stock prices of the music firms. Additionally, the evidence indicates that events that threatened Napster's survival resulted in decreases in the stock prices of the music firms. Music firms in the s le experienced negative excess returns ranging from minus .76 percent to minus .69 percent in response to anti-Napster events. On the other hand, retreats from anti-Napster events were accompanied by positive excess returns ranging from +0.56 percent to +5.05 percent. The seven anti-Napster events resulted in a total capital loss in excess of $18 billion and the four pro-Napster events created wealth in excess of $9 billion, compared to the total market capitalization of $101 billion for the s le firms.
Publisher: Emerald
Date: 03-2006
DOI: 10.1108/03074350610646753
Abstract: Prior studies examining the relation between the shareholdings by institutional investors and firm value have produced mixed results. These studies have assumed that a linear relation exists between corporate value and institutional shareholdings. The purpose of this study is to further investigate the nature of this relationship and by partitioning institutional investors into institutions that have appointed a representative to the board of directors of the firms in which they have a block investment and institutions with a similar holding but without a representative on the board of directors. The study is based on a s le of 123 firms with available financial and institutional ownership data. A cross‐sectional regression analysis is used to test the relation between corporate value and institutional ownership with and without board representation. The results of the study suggest that share ownership by investors with board representation is positively related to the value of the firm at lower levels of ownership. However, as the share ownership increases, the impact on the value of the firm becomes negative, giving rise to a non‐linear relation. The extent of shareholding by institutions without board representation, on the other hand, is not related to the value of the firm. The findings show that institutions with board representation have greater incentives to monitor management, and therefore their presence should have a positive influence on firm value. However, at high levels of ownership, institutional investors with board representation may induce boards of directors to make sub‐optimal decisions. The study provides a deeper understanding of the relationship between firm value and institutional ownership. That is, the effect of shareholding by institutions with board representation is likely to have a non‐linear relation with firm value.
Publisher: American Accounting Association
Date: 06-2016
DOI: 10.2308/JMAR-51501
Abstract: The objective of this paper is to advance the theory relating to the determinants of target costing (TC) system adoption by firms. Although the existing literature identifies several factors, it mainly clarifies the circumstances under which TC adoption will add firm value, which refers to a benefit orientation. This paper uses Miles and Snow's (1978) strategy typology to examine the cost orientation of TC adoption, which answers the question as to why firms do not adopt TC even when the existing literature alludes to the benefits of adoption. The paper argues that prospector managers possess the scope to take advantage of the high information asymmetry to avoid TC adoption, because their stock-based compensation increases with volatility in earnings and stock returns. In contrast, defender managers gain increased cash-based compensation with the adoption of TC, which helps achieve greater firm profits. The paper concludes with specific sources of agency problems and several avenues for future research.
Publisher: Wiley
Date: 03-2006
Publisher: Elsevier BV
Date: 2012
Publisher: Wiley
Date: 04-08-2010
Publisher: Elsevier BV
Date: 12-2015
Publisher: Elsevier BV
Date: 2006
DOI: 10.2139/SSRN.906690
Publisher: Wiley
Date: 04-02-2003
Publisher: SAGE Publications
Date: 17-08-2017
Abstract: Prior studies show that net stock issuance is negatively associated with the cross section of future stock returns, reflecting a market anomaly. Our study provides empirical evidence on whether cash flow can mitigate such anomaly. Consistent with prior research, we initially provide evidence of the anomaly in our s le and that the anomaly persists in the presence of cash flow. We then decompose net stock issuance into stock issues and stock repurchases and find that the anomaly is only driven by stock issues but not stock repurchases and that the stock issues’ anomaly persists even in the presence of cash flow. JEL Classification: G12, G14
Publisher: Elsevier BV
Date: 08-2014
Publisher: American Accounting Association
Date: 06-2018
DOI: 10.2308/JMAR-52171
Abstract: We examine the effect of pure (product differentiation or cost leadership) versus hybrid (a mix of product differentiation and cost leadership) business strategies on the cost of equity capital. Our results suggest that firms with a pure, relative to a hybrid, business strategy have a significantly lower cost of equity, and the cost of equity effect is equally driven by pure product differentiation and pure cost leadership strategies. We also find that firms following a pure business strategy are associated with lower systematic risk. Further, the lower cost of equity effect of a pure product differentiation strategy is more pronounced in high-technology industries and in regions with greater innovative capital. Our findings are robust to an array of robustness checks including change specification regressions and various methods for addressing endogeneity. Data Availability: All data used in this study are publicly available from the sources identified in the paper.
Publisher: Springer Science and Business Media LLC
Date: 17-08-2017
DOI: 10.1038/S41598-017-09119-Y
Abstract: There is an urgent need for the rational design of safe and effective vaccines to protect against chronic bacterial pathogens such as Mycobacterium tuberculosis . Advax™ is a novel adjuvant based on delta inulin microparticles that enhances immunity with a minimal inflammatory profile and has entered human trials to protect against viral pathogens. In this report we determined if Advax displays broad applicability against important human pathogens by assessing protective immunity against infection with M. tuberculosis . The fusion protein CysVac2, comprising the M. tuberculosis antigens Ag85B (Rv1886c) and CysD (Rv1285) formulated with Advax provided significant protection in the lungs of M. tuberculosis -infected mice. Protection was associated with the generation of CysVac2-specific multifunctional CD4 + T cells (IFN-γ + TNF + IL-2 + ). Addition to Advax of the TLR9 agonist, CpG oligonucleotide (Advax CpG ), improved both the immunogenicity and protective efficacy of CysVac2. Immunisation with CysVac2/Advax CpG resulted in heightened release of the chemoattractants, CXCL1, CCL3, and TNF, and rapid influx of monocytes and neutrophils to the site of vaccination, with pronounced early priming of CysVac2 - specific CD4 + T cells. As delta inulin adjuvants have shown an excellent safety and tolerability profile in humans, CysVac2/Advax CpG is a strong candidate for further preclinical evaluation for progression to human trials.
Publisher: American Accounting Association
Date: 07-2017
DOI: 10.2308/AJPT-51866
Abstract: Although the Sarbanes-Oxley Act of 2002 (SOX) banned most nonaudit services (NAS), it did not restrict auditors from providing tax NAS to their audit clients. In the post-SOX period, regulators and investors are highly concerned about the increase in tax NAS and consequently calling for restrictions. The profession contends that tax NAS are beneficial to the audit and opposes limitations. We contribute to this ongoing debate and fill a void in the literature by examining investors' perception of auditor-provided tax NAS, as reflected in the implied cost of equity capital. Our results suggest that investors require higher cost of equity capital for clients that generate more tax NAS revenue for their auditor's office. Further tests reveal that our main finding is driven by audit clients that report more uncertain tax reserves (higher tax risk), rather than clients that exhibit poor financial reporting quality. The effects we document are economically significant and robust to a large battery of sensitivity tests. Our findings suggest that investors seem to negatively perceive tax NAS because of punitive and cash flow risks associated with tax NAS. Data Availability: All data are publicly available from sources identified in the text.
Publisher: Emerald
Date: 03-2006
DOI: 10.1108/03074350610646744
Abstract: This paper aims to investigate whether completed vs withdrawn equity offerings result in different stock price performance prior to announcement and between announcement and withdrawal or completion. Investigates stock price performance prior to equity offerings announcements and between the announcement and actual completion or withdrawal. Stock price performance is measured by cumulative abnormal returns (CARs). It was found that stock price performance is strong only for firms that later complete the offerings. Firms that withdraw their offerings have poor stock price performance even before the announcement. Additionally, it was found that stock price performance for both the completed and the withdrawn offerings is poor after the announcement. Contrasting with prior research, the results show that firms complete their equity offerings, even though their stock price performance deteriorates. The fact that this deterioration is significantly smaller (approximately one‐third) than that of withdrawn offerings indicates that there is an acceptable level of deterioration that firms tolerate. The paper evaluates short‐run stock price performance for a number of firms in the period 1984‐2000.
Publisher: Elsevier BV
Date: 06-2012
Publisher: SAGE Publications
Date: 04-2012
Abstract: The purpose of our study is to assess the role of litigation risk in the stock price setting process in relation to the Securities and Exchange Commission (SEC) Exchange Act Rule 13a-14. We employ 12 June, the proposal of Rule 13a-14, and 27 June, the ruling of certification requirement, as event dates, and investigate litigation cost implications of the SEC proposal and ruling. We focus on firms in industries that are highly exposed to class action lawsuits and find negative abnormal returns surrounding 12 June, and positive abnormal returns surrounding 27 June, for firms relieved from compliance requirements. The results are more profound for firms in high-litigation-risk industries.
Publisher: American Accounting Association
Date: 08-2012
DOI: 10.2308/ACCR-50275
Abstract: This study examines how options trading affects the rate of return expected by investors, i.e., the implied cost of equity capital. Our cross-sectional analysis suggests that firms with listed options have lower implied cost of equity capital than firms without listed options, while the results from our temporal difference-in-differences analysis suggest that firms with listed options experience a significant decrease in their implied cost of equity capital relative to a matched s le of firms without listed options following an options listing. Moreover, we find that within firms that have listed options, firms with higher options trading volume are associated with lower implied cost of equity capital. These findings, which are robust to a wide range of additional tests, are consistent with the view that options trading improves the precision of information and reduces information asymmetry problems, resulting in lower expected return on equity. Data Availability: All data used in this study are publicly available from the sources identified in the paper.
Publisher: Elsevier BV
Date: 2010
DOI: 10.2139/SSRN.1548766
Publisher: American Accounting Association
Date: 2008
DOI: 10.2308/JMAR.2008.20.1.133
Abstract: ABSTRACT: Using a s le of 99 New Zealand stock-exchange-listed firms we employ agency framework and strategy typology to examine whether introduction of unionization legislation affects value of prospector firms more negatively than defender firms. The results from this examination indicate that firms characterized by strategy of higher Growth-Diversity and Innovation-Risk (prospector firms) experience greater loss in value. We attribute the results to the higher agency costs associated with the strategies adopted by prospector firms. The results hold after controlling for variables such as size, industry membership, labor intensity, and proportion of unionized workers.
Publisher: American Accounting Association
Date: 07-2016
DOI: 10.2308/JMAR-51537
Abstract: This study examines whether and how business strategy influences a firm's over- and under-investment decisions. Prospector and defender strategies expose firms to different required levels of investment, monitoring, and managerial discretion, which have implications for managerial investment decisions. Our results provide evidence that firms with an innovation-orientated prospector strategy are more likely to over-invest, whereas firms following an efficiency-orientated defender strategy are more likely to under-invest. These over- and under-investments are associated with poorer future firm performance. Moreover, the level of over- (under-) investment is exacerbated in the presence of more stock- (cash-) based compensation in prospector (defender) firms. Our results are robust to a number of checks such as ordered logit analysis, in idual components of business strategy, in idual components of investment, year-by-year and industry-by-industry analysis, controlling for lagged investment residuals, controlling for firm fixed-effects, first-differenced specifications, and propensity score matching.
Publisher: Elsevier BV
Date: 1999
Publisher: Emerald
Date: 07-09-2010
DOI: 10.1108/02686901011069551
Abstract: This paper aims to investigate whether the accounting reform in China has improved the relevance of China's accounting information. It seeks to investigate the association between earnings and book value of equity to share returns before and after the introduction of the Accounting System for Business Enterprises (ASBE) in 2001 for A‐ and A& B‐share firms. The paper employs the return regression model. The pre‐ASBE period is designated as 1997 through to 2000, and the post‐ASBE period is designated as 2002 through to 2004. All firms listed on the Chinese stock market during the investigation period constitute the s le. It is found that accounting information better explains share returns for both A‐share firms and A& B‐share firms in the post‐ASBE period. The paper also finds that the book value of equity for A& B‐share firms is incrementally value relevant to that of A‐share firms in the post‐ASBE period. Further studies will contribute to understanding how governance mechanisms and liquidity influence the association between accounting information and share returns in the Chinese A‐share market. The findings provide empirical evidence regarding the relevance of accounting information in emerging markets. The paper contributes to the extant value relevance literature by investigating time periods surrounding the issue of ASBE in 2001 in the Chinese stock market.
Publisher: Wiley
Date: 06-1999
Publisher: American Accounting Association
Date: 09-2017
DOI: 10.2308/ACCH-51888
Abstract: This study examines whether the relationship between managerial ability and audit fees is conditional on financial distress. We find that higher managerial ability increases audit fees in financially distressed firms and decreases audit fees in non-distressed firms. We also observe that financially distressed firms with higher-ability managers display lower accrual quality and a higher likelihood of restatement. Moreover, higher-ability managers in distressed firms engage more in opportunistic financial reporting to concurrently maximize equity-based compensation and cope with debt refinancing pressures, which increases audit risks and results in greater audit fees. We confirm our results using a battery of sensitivity and additional analyses.
Publisher: Virtus Interpress
Date: 2007
DOI: 10.22495/COCV5I1C3P1
Abstract: We examine the economic reasons underlying the behavior of some senior managers to inflate their firms’ reported earnings. While the extant literature cites accounting and corporate governance structure as potential reasons that facilitate the inflating tendency, we conjecture that opportunism at different hierarchical levels within firms do not leave much scope for some senior managers to improve firms’ fundamental performance. To protect their personal utility, they resort to inflating tendency, but only if the firms’ corporate governance has loopholes. A major solution offered here is to improve firms’ internal management control system which could reduce within-firm opportunism. However, this solution must accompany improvements to corporate governance.
No related grants have been discovered for Farshid Navissi.