At the annual Faculty Awards celebration, Assistant Professor of Accounting Robert Felix received the Merrick School of Business's Black & Decker Outstanding Article award for his 2019 co-authored article titled “Spillover Effects of Internal Control Weakness Disclosures: The Role of Audit Committees and Board Connections” Contemporary Accounting Research.

"I'm honored to win the best paper award," said Felix. "I'd like to thank Dean Dalziel and the whole executive team for their consideration. And I'd also like to thank my department chair, Phil Korb, for the nomination and his support. I think the paper gives an adds to the literature about into how information spreads between firms through directors and how financial reporting can be affected by the experience of directors at other firms."

In this article, the researchers were interested to see whether a firm's likelihood of having a material weakness in a particular year is affected by an audit committee members' prior experience with a material weakness disclosure. The researchers found that a firm is less likely to have a material weakness when one of its audit committee member experienced a material weakness at another firm in the past. One explanation of their findings is that the prior experiences of directors outside the firm influences their work on the audit committees inside the firm. To that end, the study suggests that directors diffuse important insights based on their prior experience and serve as a catalyst for improvements in a firm’s internal control and financial reporting practices.

Internal controls are the policies and procedures put in place to ensure the integrity of the financial reporting system. The Sarbanes-Oxley Act (SOX) requires publicly traded firms to disclose the status of their internal control system, and to specifically state if their internal controls have a material weakness. A material weakness indicates that the internal control system has a problem big enough that could potentially lead to misstatement in financial reports. As such, reporting a material weakness is viewed negatively and is generally associated with a host of consequences. 

Learn more about Prof. Felix.  

In addition to the Outstanding Article Award, the School of Business announced professorships, chairs and annual teaching awards for the academic year 2018-19 at the school’s May awards ceremony:

Professorships / Chairs

• Regina Bento, professor of management, awarded the Baltimore Gas and Electric Chair
• Mikhail Pevzner, associate professor of accounting, continues to hold the E&Y Chair in Accounting
• Amir Pezeshkan, assistant professor of management and international relations, awarded the 
• CSX Leadership Chair
• Dennis Pitta, professor of marketing, continues to hold the J. William Middendorf Distinguished Professor
• Eusebio Scornavacca, assistant professor of information systems, continues to hold the John P. & Margaret M. Thompson Professorship in MIS
• Jaya Singhal, professor of decision science, continues to hold the Frank Baker Chair for Research Excellence
• Kalyan Singhal, professor of supply chain management, continues to hold the Doris and Robert McCurdy Chair
• Lourdes White, professor of accounting, awarded the Lockheed Martin Chair
• Nafeesa Yunus, associate professor of finance and real estate, awarded the Harry Y. Wright Chair

Annual Teaching and Service Awards

• William Carter, assistant professor of management  received the Dean Clifford C. James Chair for Distinguished Teaching.
• Robert Felix, assistant professor of accounting received the Yale Gordon Chair of Distinguished Teaching.
• Jeffrey Weaver, adjunct management faculty received the Adjunct Faculty Award.
• J.C. Weiss, received the Turner Medallion.
• Jan Williams, associate professor of accounting, received the Yale Gordon Chair for Distinguished Teaching and the Dean Daniel Costello Service Award.
• Frank van Vliet, executive-in-residence in marketing and entrepreneurship, received the G. Maxwell Armor Professorship.
• Ting Zhang, assistant professor of economics received the T. Rowe Price Excellence in Teaching.