Li co-authored the winning study, “Do the FASB’s Standards Add Shareholder Value?” with Dr. Urooj Khan and Dr. Shivaram Rajgopal of Columbia University and Dr. Mohan Venkatachalam of Duke University.
Their work was one of two Best Paper awards that will be announced at the American Accounting Association’s annual meeting, to held in Maryland in August.
“I’m gratified to be recognized by such a prestigious organization,” Li said. “My coauthors and I started working on the project in 2012, when I first joined the Jindal School. Without the continuous support from the school and my colleagues, I cannot imagine this would have happened.”
The paper was published in the March 2018 issue of the association’s publication The Accounting Review. Established in 1926, it is one of the oldest academic journals in accounting and considered one of the six leading accounting journals. It is one of 24 journals used to compile the UT Dallas Top 100 Business School Research Rankings™, an index that tracks faculty research productivity at management and business schools.
The study, Li said, addresses the “big-picture” question of whether the Financial Accounting Standards Board’s (FASB) standard-setting process has been effective. The team examined the stock-market reaction to FASB standards issued between 1973 and 2009.
“Other disciplines often study the efficacy of mandatory disclosure in areas of healthcare, nutrition, workplace hazards and others,” Li said. “Our paper is the first accounting study to comprehensively examine the FASB’s standard-setting efficacy.”
The study found that the large majority of FASB standards are a “non event,” according to Li. Only 11 percent (15 of 138) standards improved shareholder value, while 19 standards actually decreased shareholder value.
Two other Jindal School faculty members won awards from the Financial Accounting and Reporting Section of the association this year. Dr. Maria Loumioti, assistant professor of accounting, was one of 22 recipients of the Outstanding Discussion award. Dr. Lale Guler, clinical associate professor of accounting, was one of 88 recipients of the Excellence in Reviewing award.