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- Creators: School of Accountancy
- Creators: Lowe, Jordan
- Member of: Barrett, The Honors College Thesis/Creative Project Collection
- Resource Type: Text
Description
Executive compensation is broken into two parts: one fixed and one variable. The fixed component of executive compensation is the annual salary and the variable components are performance-based incentives. Clawback provisions of executive compensation are designed to require executives to return performance-based, variable compensation that was erroneously awarded in the year of a misstatement. This research shows the need for the use of a new clawback provision that combines aspects of the two currently in regulation. In our current federal regulation, there are two clawback provisions in play: Section 304 of Sarbanes-Oxley and section 954 of The Dodd\u2014Frank Wall Street Reform and Consumer Protection Act. This paper argues for the use of an optimal clawback provision that combines aspects of both the current SOX provision and the Dodd-Frank provision, by integrating the principles of loss aversion and narcissism. These two factors are important to consider when designing a clawback provision, as it is generally accepted that average individuals are loss averse and executives are becoming increasingly narcissistic. Therefore, when attempting to mitigate the risk of a leader keeping erroneously awarded executive compensation, the decision making factors of narcissism and loss aversion must be taken into account. Additionally, this paper predicts how compensation structures will shift post-implementation. Through a survey analyzing the level of both loss- aversion and narcissism in respondents, the research question justifies the principle that people are loss averse and that a subset of the population show narcissistic tendencies. Both loss aversion and narcissism drove the results to suggest there are benefits to both clawback provisions and that a new provision that combines elements of both is most beneficial in mitigating the risk of executives receiving erroneously awarded compensation. I concluded the most optimal clawback provision is mandatory for all public companies (Dodd-Frank), targets all executives (Dodd-Frank), and requires the recuperation of the entire bonus, not just that which was in excess of what should have been received (SOX).
ContributorsLarscheid, Elizabeth (Author) / Samuelson, Melissa (Thesis director) / Casas-Arce, Pablo (Committee member) / WPC Graduate Programs (Contributor) / School of Accountancy (Contributor) / Barrett, The Honors College (Contributor)
Created2018-12
Description
This paper discusses the development of the mobile gaming industry and analyzes a mobile game acquisition to provide context to the entire market. By discussing the history and growth of the industry, I discovered that mobile gaming was a massive opportunity for companies to generate lucrative earnings. The discussion revolving around the evolution of the mobile gaming business model serves to provide context on the industry’s unique opportunities and risk factors. Candy Crush’s developer King is the main focus in this paper as they were the highest-performing public company in the market. The company is the greatest example of the mobile gaming phenomenon, experiencing rapid growth due to the success of its games, faltering in financial performance after going public, and finally becoming a subsidiary of a larger video game company that recognized King’s potential. King’s acquirer, Activision-Blizzard (ATVI), is an industry veteran of the overall video game industry that bought out King in an attempt to capitalize on the rising popularity of mobile games and to improve their strategic position in the larger video game market. The mergers & acquisitions (M&A) analysis between ATVI and King serves to determine whether or not the acquisition was an appropriately priced deal and if King represented a worthy buy. A discounted cash flows model is the basis for the analysis using a wide range of assumptions to account for the volatility of the industry. Finally, an event study and post-acquisition analysis are conducted to determine if any financial synergies were achieved in the ATVI-King acquisition. While the analyses do not offer a definitive conclusion on King’s post-acquisition performance, it can be said that the company has managed to achieve some measure of longevity. In the context of the entire mobile gaming market, the potential of mobile games should make developers attractive in the eyes of investors and acquirers, provided they understand the mobile gaming industry’s unique risks.
ContributorsDai, Yongjun (Author) / Simonson, Mark (Thesis director) / Geoffrey, Smith (Committee member) / Department of Finance (Contributor) / School of Accountancy (Contributor) / Barrett, The Honors College (Contributor)
Created2019-05
Description
Given its impact on the accounting profession and public corporations, Sarbanes-Oxley Act of 2002(SOX) is a widely researched regulation among accounting scholars. Research typically focuses on the impact it has had on corporations, executives and auditors, however, there is limited research that illustrates the impact SOX may have on average Americans. There were several US criminal code sections that resulted from the passing of SOX. Statute 1519, which is often referred to as the "anti-shredding provision", penalizes anyone who "knowingly alters, destroys, mutilates, conceals, covers up, falsifies, or makes a false entry in any record, document, or tangible object with the intent to" obstruct a current or foreseeable federal investigation. This statute, although intended to punish behavior similar to that which occurred in the early 2000s by corporations and auditors, has been used to charge people beyond its original intent. Several issues with the crafting of the statute cause its broad application and some litigation even reached the Supreme Court due to its vague wording. Not only is the statute being applied beyond the intent, there are other issues that legal scholars have critiqued it for. This statute is far from being the only law facing these issues as the same issues and critiques are found in the 14th amendment. Rewriting the statute seems to be the most effective way to address the concerns of judges, lawyers and defendants regarding the statute. In addition, Congress could have passed this statute outside of SOX to avoid being seen as overreaching if obstruction of justice related to documents was actually an issue outside of corporate fraud.
ContributorsGonzalez, Joana (Author) / Samuelson, Melissa (Thesis director) / Lowe, Jordan (Committee member) / School of Accountancy (Contributor) / Barrett, The Honors College (Contributor)
Created2016-12
Description
This paper consists of a literature review, wherein four papers surrounding Motivation Crowding Theory (MCT) were read and analyzed. The paper then goes into an analysis of a survey I conducted. The survey consisted of three main questions with three sub-questions for each, and all attempted to find a "limit" to MCT. However, results for the survey were ultimately inconclusive. The paper concludes with lessons learned in conducting research and surveys in particular, as well as a nod to the relevancy of MCT in business and personal applications.
ContributorsSmith, Mallory Anne (Author) / Reckers, Phil (Thesis director) / Samuelson, Melissa (Committee member) / Lowe, Jordan (Committee member) / School of Accountancy (Contributor) / Department of Information Systems (Contributor) / WPC Graduate Programs (Contributor) / Barrett, The Honors College (Contributor)
Created2020-05