CEO Pay Components and Aggressive Non-GAAP Earnings Disclosure

Dirk E. Black, Ervin L. Black, Theodore E. Christensen, Kurt H. Gee

Research output: Contribution to journalArticlepeer-review

7 Scopus citations


We examine the relation between CEO pay components and aggressive non-GAAP earnings disclosures using CEO pay components as proxies for managers’ short- versus long-term focus. Specifically, we explore the extent to which short-term bonus plan payouts and long-term incentive plan payouts are associated with: (1) Managers’ propensity to exclude expense items in excess of those excluded by equity analysts; and, (2) The magnitude of those incremental exclusions. We find that long-term incentive plan payouts are negatively associated with the likelihood and magnitude of aggressive non-GAAP exclusions. Our results are consistent with managers reporting non-GAAP information less aggressively when they are more focused on long-term, rather than short-term, value.

Original languageEnglish (US)
Pages (from-to)648-675
Number of pages28
JournalJournal of Accounting, Auditing and Finance
Issue number3
StatePublished - Jul 2023

All Science Journal Classification (ASJC) codes

  • Accounting
  • Finance
  • Economics, Econometrics and Finance (miscellaneous)


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