Samuel Tan




PhD Candidate in Accounting

Haas School of Business, UC Berkeley


Selected Research


“Accounting Choices and the Legal Environment: the Impact of the Ex Post Loss Rule”. Job market paper.

Abstract: Using a landmark Supreme Court decision as a natural experiment, I examine the impact of a fundamental requirement in securities litigation—the ex post loss rule—on income-decreasing accounting choices. Dura Pharmaceuticals v. Broudo (2005) established that plaintiffs must show that the alleged misrepresentations caused an actual economic loss. The case resolved a circuit split, allowing me to identify a treatment jurisdiction affected by Dura, and control jurisdictions in which the rule was already the prevailing legal standard. Motivated by legal analyses suggesting that Dura incentivizes firms to withhold or delay negative corrections, I hypothesize and find that treatment firms in high-litigation industries became more likely to delay write-downs and avoid income-decreasing accrual error reversals at the firm level after Dura, relative to matched control firms. This study sheds light on the relationship between securities law and accounting practices, and informs policy makers on the accounting impact of a key feature of the legal environment.

I’m currently revising the paper to incorporate very much appreciated feedback and suggestions. Latest version: PDF, SSRN.


“How Do Accounting Practices Spread? An Examination of Law Firm Networks and Stock Option Backdating”, with Patricia Dechow.

Abstract: We hypothesize that one way accounting practices spread is through law firm connections. We investigate this prediction by examining companies that avoided reporting compensation expense by engaging in stock option backdating. We hypothesize that executives engaged in backdating because they were desensitized to its inappropriateness when they learned through their legal counsel that other companies were engaging in this practice. Using network analysis, we document that backdating companies are more highly connected with other backdating companies via shared law firms. Further, logistic regressions indicate that the likelihood that a company backdates is 57 to 271 percent higher when its law firm has had another client that backdated. We find that sharing a law firm is incremental to and more economically significant than the impact of board interlocks and geographical location for explaining backdating. Our evidence is consistent with law firms acting as “system supporters” in enabling executives to engage in backdating.

We’re currently revising the paper in preparation for resubmission to The Accounting Review. Latest version: PDF.


“SEC-Affiliated Lawyers and Corporate Disclosures”, with Michael Shen.

Abstract: Government officials, advocacy groups, and the business press have raised concerns that former SEC employees may continue to have an influence on the SEC after leaving the agency. Using a hand-collected database of the characteristics of individual lawyers that represent firms in responding to SEC comment letters, we examine the impact of individual lawyers on the comment letter process. We document significant differences between lawyers and law firms in their clients’ resistance to SEC comment letters, and we find that differences between individual lawyers have more explanatory power than differences between individual law firms. After matching on lawyer, comment letter, and firm characteristics, we find evidence that involving SEC-affiliated lawyers in comment letter conversations is associated with less timely resolution, more conversation rounds, and fewer financial statement amendments. However, we find no statistical evidence that SEC affiliation is associated with long-term post-comment letter outcomes, namely future comment letter conversations, restatements, and litigation.

We’ve completed the data collection and analyses and are now completing a manuscript for conference submissions.


Please refer to my CV for more information about my work!