Reporting Choice and the 1992 Proxy Disclosure Rules

JOURNAL OF ACCOUNTING, AUDITING AND FINANCE, Vol 11, No 3, Summer 1996

Posted: 12 Feb 1998

See all articles by Kevin J. Murphy

Kevin J. Murphy

University of Southern California - Marshall School of Business; USC Gould School of Law

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Abstract

Disclosure rules adopted by the Securities Exchange Commission in 1992 allowed limited managerial discretion in reporting the value of stock options granted. I provide evidence that managers adopted valuation methodologies that reduced reported or perceived compensation and that also reduced potential accounting charges for stock options. I interpret this evidence as supporting the hypothesis that managers bear non-pecuniary costs from high reported levels of compensation-through increased political or shareholder pressure-and adopt reporting methodologies that reduce these costs.

JEL Classification: J32, M41, M45

Suggested Citation

Murphy, Kevin J., Reporting Choice and the 1992 Proxy Disclosure Rules. JOURNAL OF ACCOUNTING, AUDITING AND FINANCE, Vol 11, No 3, Summer 1996, Available at SSRN: https://ssrn.com/abstract=2649

Kevin J. Murphy (Contact Author)

University of Southern California - Marshall School of Business ( email )

BRI 308, MC 0804
Los Angeles, CA 90089-0804
United States
213-740-6553 (Phone)
213-740-6650 (Fax)

USC Gould School of Law

699 Exposition Boulevard
Los Angeles, CA 90089
United States

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