Accounting choices and the legal environment: The impact of the ex post loss rule

• Main Author: TAN, Teck Meng Junior
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2018
• Subjects: Write-downs; Accruals; Supreme Court; Securities Litigation; Accounting; Accounting Law
• Online Access: https://ink.library.smu.edu.sg/soa_research/1723; https://ink.library.smu.edu.sg/context/soa_research/article/2750/viewcontent/SSRN_id2857703.pdf
• Institution: Singapore Management University

Using a landmark Supreme Court decision as a natural experiment, I examine the impact of a fundamental requirement in securities litigation, the ex post loss rule, on income-decreasing accounting choices. Dura Pharmaceuticals v. Broudo (2005) established that plaintiffs must show that the alleged mi...