Yaw Mensah

Rutgers Business School, Office of the Dean, Faculty Member

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Papers by Yaw Mensah

Correction to: The disciplinary effect of taxpayer balloting on public spending: some empirical evidence

Review of Quantitative Finance and Accounting, Jan 18, 2023

The row of data for the intercept in the regressions of the Type 4 school districts and the Type ... more

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Preferred Leadership Styles, Culture, and Government Fiscal Transparency: An International Analysis

Advances in economics and business, Jun 1, 2016

Evidence provided by the GLOBE study (House et al ) has shown that different cultures have defini... more Evidence provided by the GLOBE study (House et al ) has shown that different cultures have definite preferences for different leadership styles. This study examines whether the cultural preference for specific leadership styles has implications for the development of transparency in government budgetary reporting. Our results show that the Performance-Oriented and the Autonomous leadership styles are positively associated with greater transparency while the Team-Oriented and Humane leadership styles have a negative relationship. When Lewin's classical leadership styles are introduced, we found that both the Democratic and Autocratic leadership styles were positively associated with budget transparency. In contrast, the Delegative leadership style is found to be negatively associated with budget transparency. One major implication of this study is that the movement towards greater transparency in government budgeting would be facilitated by changes in cultural preferences for certain leadership styles.

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Disclosure of the Fair Value of Executive Stock Options Granted to Top Executives

Social Science Research Network, 2007

This paper examines the determinants of a company's choice of disclosure informativeness. The spe... more This paper examines the determinants of a company's choice of disclosure informativeness. The specific context is the disclosure of the value of stock options granted to the top executives under the SEC's Regulation S-K (Item 403). We show that firms with executives who are excessively paid, poorly-performing firms, and firms which are substantially owned by insiders, are more likely to choose the less informative disclosure method. On the other hand, larger firms, firms which are widely covered by analysts, firms with high financial leverage, and those which voluntarily expense their executive options, are more likely to choose the more informative disclosure. We also provide evidence that firms with higher accounting integrity command a higher market valuation.

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An approach to evaluating relative effectiveness in non-profit institutions

Journal of Public Budgeting, Accounting & Financial Management, Mar 1, 2008

We present, in this study, a method for comparing the relative effectiveness of different non-pro... more We present, in this study, a method for comparing the relative effectiveness of different non-profit institutions with similar objectives. In addition, we show how this measure of relative effectiveness is related theoretically to their relative efficiency. Relative effectiveness is shown to be a product of the efficacy with which potentially utilizable resources can be converted into usable inputs, and the efficiency with which the inputs are converted to outputs or outcomes. Finally, drawing on developments in data envelopment analysis, we illustrate the new methodology using data from 109 institutions of higher education.

The Inferential Value of Quarterly Earnings Announcements Relative to Other Sources of Information

Social Science Research Network, 2006

Abstract This paper evaluates the prevalent view that accounting information competes with, but ... more Abstract
This paper evaluates the prevalent view that accounting information competes with, but also disciplines, information from other sources by examining the inferential value to investors of accounting versus non-accounting information. Inferential value is defined as the ability of the capital markets to draw the correct inference from the information signals regarding future firm performance. Both average quarterly accounting rate of return on equity and excess stock returns are used as measures of firm performance. The findings indicate that a market-normalized accounting rate of return derived from stock prices and excess returns measured around earnings announcement dates are more highly correlated with changes in future firm performance than similar measures in the non-disclosure periods. The findings support the prevalent view that accounting information disciplines information from other sources.

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A database approach to the design of macro-oriented enterprise accounting systems in developing countries

157 p.Thesis (Ph.D.)--University of Illinois at Urbana-Champaign, 1979.U of I OnlyRestricted to t... more

The disciplinary effect of taxpayer balloting on public spending: some empirical evidence

Review of Quantitative Finance and Accounting, Oct 26, 2022

1 An Empirical Analysis of the Effect of Performance-Based Budgeting on State

Government Expenditures This paper examines the economic effects of the adoption and implementati... more Government Expenditures This paper examines the economic effects of the adoption and implementation of performance-based budgeting (PBB) at the state government level. We examine the association between the implementation of PBB and aggregate state expenditures from the General Fund and Other State Funds, and further analyze whether PBB affects combined functional spending: Future-oriented expenditures (Public Education, Higher Education, and Transportation), Social expenditures (Public Aid, and Public Health/Medicaid), Public safety expenditures (Correctional Facilities) and Other expenditures. We find that the implementation of PBB is negatively associated with total expenditures from General Fund and positively associated with total expenditures from Other State Funds. The effect of PBB on combined functional spending is significantly negative for Future-oriented expenditures and Socially-oriented expenditures from the General Fund, but there is a positive relationship between PB...

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The Pendulum Effects of Legislation on the Probity of Financial Statements

SSRN Electronic Journal, 2019

Extant theories in sociology, criminal justice, economics, and even political science posit the e... more Extant theories in sociology, criminal justice, economics, and even political science posit the existence of periodicity in human affairs similar to a pendulum which swings from one extreme to the other. We examine in this study whether such a phenomenon exists in financial reporting, with periods of lax financial reporting followed by legislation which corrects the pendulum swing to the other direction, and eventually a reversal back to laxity. Focusing on the period from 1973 to 2017, we examine the effects of the four successive major laws intended to address internal controls and ensure greater probity in financial reporting, namely the Foreign Corrupt Practices Act (FCPA, 1977), the Omnibus Trade and Competitiveness Act of 1988 (OTCA, 1988), the Sarbanes-Oxley Act (SOX, 2002), and the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (DFA, 2010). Using an industry-level aggregate measure of innate and discretionary accruals as the measures of probity in financial statements, we find evidence of a long-cycle pendulum effect, with the period from 1973 to 2000 forming the downward swing (from the innate accruals standpoint), and an upswing from 2001 to 2017. Validation tests for the industry-level aggregate measures of innate and discretionary accruals find support for them as capturing creditor and equity investor perceptions of changes in information risk over the period examined.

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Measuring The Usefulness Of Information For Investors Inferences: The Case Of Quarterly Earnings Announcements

Journal of Business & Economics Research (JBER), 2010

In this paper, we propose a new method for assessing the usefulness of information, its inferenti... more In this paper, we propose a new method for assessing the usefulness of information, its inferential value. In the context of accounting and finance, we define the inferential value of information about a firm as how efficaciously the information enables investors to draw correct inferences regarding its future financial performance. On the basis of this definition, we develop a stylized model to measure the proximity of a firm’s future realized rates of return to the estimated rates of return implied by its current stock price. We then use the new measure to test the hypothesis that quarterly earnings announcements have a higher inferential value than other information arriving during interim (non-earnings announcement) periods. Our empirical findings suggest that investors are able to make more informative inferences about a firm’s future profitability based on quarterly earnings announcement than based on information available during interim periods. However, our findings also sug...

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The role of corporate governance during the pre- and post-Sarbanes Oxley periods

International Journal of Corporate Governance, 2010

This study examines the joint effects of the passing of Sarbanes-Oxley Act (SOX) of 2002 and firm... more This study examines the joint effects of the passing of Sarbanes-Oxley Act (SOX) of 2002 and firm-specific corporate governance mechanisms on the value-relevance of earnings. We find that value-relevance of earnings is significantly different for different sub-periods. We find that good corporate governance (proxied by lack of anti-takeover provisions) has a positive impact on the value-relevance of earnings only during the scandal (SCA) period. These results hold after controlling for changes in institutional ownership and earnings quality (EQ). Our results suggest that there is a substitution effect between good firm-specific corporate governance mechanisms and the strictness of the regulatory environment.

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The informativeness of operating statements for commercial nonprofit enterprises

Journal of Accounting and Public Policy, 1996

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The Effect of Corporate Governance Structure on Employee Stock Option Accounting and Disclosure

Measuring production efficiency in a not-for-profit setting: An extension

Accounting review: A quarterly journal of the American Accounting Association, 1993

The main objective of this study is to extend Hayes and Millar's idea of a trans log budge... more The main objective of this study is to extend Hayes and Millar's idea of
a trans log budget model by outlining a more complete budgetary system. It
is shown that a frontier cost function generated from the ordinary least
squares (OLS) translog function can be used to identify four types of
inefficiencies: the degree of technical, allocative, and scale inefficiency as
well as institutional X-inefficiency (Liebenstein 1966). These four types of
inefficiencies are then linked to both the long-term and short-term
objectives of budgeting; namely, performance evaluation, subordinate
manager motivation, planning, and control.
The second objective of the study is to compare the translog budget
model (as revised) against the most frequently applied alternative
technique, the nonparametric data envelopment analysis (DEA), in the
same context. From the standpoint of a routine budgetary control system,
it was found that the DEA model is more suitable than the translog model.

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The Determinants of Investor Valuation of R&D Expenditure in the Software Industry

This paper examines the cross-sectional variability in the market valuation of R&D expenditures i... more This paper examines the cross-sectional variability in the market valuation of R&D expenditures in the pre-packaged computer software industry. Consistent with some prior research, this paper argues that R&D spending is valued heterogeneously by the stock market, and derives hypotheses regarding the determinants of the cross-sectional heterogeneity in the market valuation of R&D. The empirical tests use an extensive database containing product level information of software firms between 1994 and 1998, along with accounting and stock price data of the same period. The test results, consistent with our hypotheses, show that R&D spending is more valuable for firms with larger market shares, higher percentage of technical employees, and those that have diversified into different product categories. The results also indicate that market valuation of R&D spending is a function of product life cycle.

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The Effect of Local Property Taxes and Administrative Costs on Student Achievement Scores: Evidence from New Jersey Public Schools

Retrieved from SSRN: http://ssrn. …, 2010

Page 1. Electronic copy available at: http://ssrn.com/abstract=1578853 The Effect of Local Proper... more

The role of corporate governance during the pre- and post-Sarbanes Oxley periods

by Anthony Ng and Yaw Mensah

International Journal of Corporate Governance, 2010

A Dynamic Approach to the Evaluation of Input-Variable Cost Center Performance

... Yaw M. Mensah ABSTRACT: Given the recent history of double-digit inflation, there is an incre... more

Capital Expenditure Analysis and Automated Manufacturing Systems: A Review and Synthesis

An Analysis of the Effect of Culture and Religion on Perceived Corruption in a Global Context

Journal of Business Ethics, 2014

Abstract: Research into the potential determinants of corruption is myriad. Yet none of the studi... more

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