Carroll Faculty Honored by American Accounting Association

The American Accounting Association recently gave two awards to faculty at the Carroll School of Management’s Accounting Department. Associate Professor Susan Shu won the prestigious Notable Contributions to Accounting Literature Award for her co-authored paper “Do Managers Withhold Bad News?” that was published in the Journal of Accounting Research in 2009. The three-year project refutes the conventional wisdom that managers disclose bad news in a timely manner because they don’t want to get sued.

Shu and her colleagues found that managers hide bad news because of career concerns, such as promotion, compensation and fear of job loss. “Often times they gamble that things would turn around,” said Shu. “They hope that if they bury the bad news and things turn around, they’ll be OK. But when the bad news accumulates up to some threshold, they cannot withhold it anymore, and they release it. And often, we’ll see stock price crashes because bad news has been withheld and accumulated for a while.”

Shu, whose award is her first recognition by AAA, said being at the Carroll School has benefited her because of its “strong research culture that encourages high-impact research.”

She added, “I am glad that our work is making an impact on the literature and has generated widespread interest from the profession. I hope it will continue to influence people’s thinking.”

Sweeney Professor of Accounting Peter Wilson and his wife Carolyn, a lecturer, won the Innovation in Accounting Education Award. The award honors persons whose work spurs interest in the study of accounting, improves the effectiveness of education, demonstrates educational value and innovation, and can be adopted by other educational institutions.

With Shu and the Wilsons, seven Carroll School faculty members have now been recognized by the AAA.

regions: Boston

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