Date of Award

5-31-2026

Document Type

Campus Access Dissertation

Degree Name

Doctor of Philosophy (PhD)

Department

Business Administration

First Advisor

Atreya Chakraborty

Second Advisor

Mine Ertugrul

Third Advisor

Chi Wan

Abstract

This dissertation employs large language models (LLMs), machine learning algorithms, and big data to develop novel, empirically validated measures that examine how firms respond to legislative policy, utilize language in their disclosures, and rely on internal employee accounting expertise. The first essay develops a firm-level measure of legislative policy exposure by employing LLM to assess the anticipated economic impact of every bill introduced in the U.S. Congress on public companies. It validates these measures using short-term cumulative abnormal returns (CARs) and shows that they are meaningfully associated with future firm outcomes and forward-looking disclosure behavior. The second essay focuses on the readability measure of financial disclosures in 10-K filings, decomposing it between complexity due to intentional managerial obfuscation and complexity stemming from business operations. The decomposed measures are validated using established readability determinants. They are differently associated with earnings persistence, earnings management, and abnormal trading volume, especially among firms with different types of institutional investors. The third essay examines how firms’ stock of accounting expertise, proxied by the number of active Certified Public Accountants (CPAs), is associated with financial reporting quality and informative forward-looking disclosures. It constructs a firm-level measure of active CPA representation and general employee education for publicly traded firms in the United States. The results show that firms with more active CPA employees exhibit higher financial reporting quality and produce more informative forward-looking disclosures. Together, the essays advance our understanding of how legislative policy,  disclosure language, and internal accounting expertise shape firms’ information environment and  financial reporting outcomes.

Comments

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