Full metadata record
DC Field | Value | Language |
---|---|---|
dc.contributor.author | Bartov, Eli | - |
dc.contributor.author | Mohanram, Partha | - |
dc.date.accessioned | 2008-06-13T08:02:28Z | - |
dc.date.available | 2008-06-13T08:02:28Z | - |
dc.date.issued | 2004-04 | - |
dc.identifier.uri | http://hdl.handle.net/2451/27566 | - |
dc.description.abstract | This paper investigates the decision by top-level executives of more than 1,200 public corporations to exercise large stock option awards in the period 1992-2001. We hypothesize and find that abnormally large option exercises predict stock return future performance. We then hypothesize that this predictive ability represents private information about disappointing earnings in the post-exercise period. Consistent with this hypothesis we find that abnormally positive earnings performance in the pre-exercise period turns to disappointing earnings performance in the post-exercise period, and that this pattern comes as a surprise to even sophisticated market participants (financial analysts). We also hypothesize and find that the disappointing earnings in the post-exercise period represent a reversal of inflated earnings in the pre-exercise period. Collectively, these findings suggest that the private information used by top-level executives to time abnormally large exercises follows from earnings management so as to increase the cash payout of exercises. | en |
dc.language.iso | en_US | en |
dc.relation.ispartofseries | Eli Bartov-06 | en |
dc.subject | Executive compensation | en |
dc.subject | Incentives | en |
dc.subject | Stock option exercises | en |
dc.subject | Earnings management | en |
dc.title | Private Information, Earnings Manipulations, and Executive Stock Option Exercises | en |
dc.type | Working Paper | en |
Appears in Collections: | Accounting Working Papers |
Files in This Item:
File | Description | Size | Format | |
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SSRN-id492302.pdf | 262.74 kB | Adobe PDF | View/Open |
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