Melissa Lewis-Western, assistant professor of accounting at the Eccles School, recently returned from the Western Region Meeting of the American Accounting Association. There, she was honored with a best paper award.

Her paper, “Competing reporting objectives and financial reporting quality” that she co-wrote with Adrienna Huffman, beat out more than 80 papers to win the top honor.

The paper looked at the multiple incentives managers face when reporting their financial information. Managers are incentivized to report accurately, but they also receive incentives to report aggressively. The paper analyzes those competing incentives to see how it impacts managers’ reporting strategies.

Congratulations, Professor Lewis-Western!

Check out the video above and the podcast below to learn more.

Podcast transcript:

Eccles School: Welcome to the Eccles School podcast, I’m your host Sheena McFarland. Today we are joined by Melissa Lewis-Western, assistant professor of accounting at the Eccles School. She recently returned from the Western Region Meeting of the American Accounting Association where she was honored with an award for best paper. Melissa, thank you so much for joining me today.

Melissa Lewis-Western: Sheena thank you, it is wonderful to be here.

Eccles School: First, tell me a little bit about your paper, “Competing Reporting Objectives and Financial Reporting Quality” that you co-wrote with Adriana Hoffman.

Melissa Lewis-Western: This is a really fun project. We consider managers’ competing incentives. On the one hand, managers want to report high-quality financial information because they have lots of benefits or they receive lots of benefits for doing that, but at times, they face competing incentives. And the big innovation in our paper is to show that the source of those competing incentives impacts managers’ reporting and disclosure decisions. This is really going to be helpful, I think, to shareholders, creditors and even possibly to regulators and understanding when companies’ financial information is of high quality and when it is not.

Eccles School: That’s awesome and it sounds like this paper is a little bit unique as it is looking at multiple incentives instead of just one. Can you talk to me a little bit more about that?

Melissa Lewis-Western: Yeah, often times in research because a little bit more convenient, we consider one type of incentive at a time, but we know in reality managers face lots of incentives; they want to reduce the tax burden, they want to report higher earnings to impact stock price, they want to not breach their debt covenant contracts, so many, many incentives. And in this paper, we take a step forward by considering many of those competing incentives and how those incentives interact and ultimately impact managers reporting and disclosure decisions.

Eccles School: Great and obviously, it caught the eye of your colleagues. You had some pretty stiff competition at the Western region meeting of the American Accounting Association where you had more than 80 papers vying for the title of best, but you are the one walked home with it. So tell me a little bit about how you feel about winning that award.

Melissa Lewis-Western: Yeah, that was really exciting and we really appreciated that acknowledgment from our colleagues. The Western Regional Meeting is a very well attended meeting because it is usually held in a nice place, this year it was in Coronado. So there were many papers that were submitted because everyone wants to go there and present. So it was nice to be awarded the best paper, and I think what that means is that we have hit a topic that is of a lot of interest to a broad range of people. I think financial reporting quality and how managers trade off all of these incentives or competing incentives they face is a really important topic and our colleagues acknowledged that with the award.

Eccles School: Well congratulations again! It sounds like in addition to this amazing paper that you brought, you helped doctoral students who attended through the doctoral students’ faculty interchange. So tell me a little bit more about what that interchange looks like.

Melissa Lewis-Western: Yeah, this is a really fun program. Essentially, we have doctoral students bring a faculty member from their institution and the student presents and the faculty member discusses their paper and then we flip-flop and the faculty presents and the student discusses. And it is a really great opportunity for the students to get feedback, but more importantly and the goal of the program is for the students to see that every paper is not perfect when it starts and that every paper benefits from feedback and from discussion. And that the important part is to just start a project, start getting feedback and continue to be open to learning and that’s what happens at conferences and I think it was a great opportunity for the students and for us faculty to see what they’re working on and to share a little bit of what we have learned.

Eccles School: That sounds like a wonderful opportunity for students. What other opportunities does the American Accounting Association provide students?

Melissa Lewis-Western: The American Accounting Association is a great association. It is for academics and essentially, we try to be thought leaders on issues related to accounting and economy and how we can better do things. And for students, I think the reason they might want to join is because they want to ultimately be leaders in their community, in their schools, in their professions and this is a wonderful place not only to get education but also get exposure to make contacts and get to mingle with the best and the brightest. That, of course, can only help.

Eccles School: Wonderful. Well Melissa, thank you so much for taking the time to sit down with me today.

Melissa Lewis-Western: It is my pleasure, thank you.

Eccles School: I am Sheena McFarland, and this has been the Eccles School podcast.