In response to a series of high profile financial accounting scandals, regulations were passed to create a uniform reporting environment for publicly traded companies. Although the intent of these regulations is to require firms to release value relevant information in a prominent and timely fashion, guidance provided by regulators subsequent to their issuances seems to have created loopholes. Some issuers have interpreted this to mean that they are not always required to file a statement of non-reliance when disclosing a financial accounting restatement. This loose interpretation gives rise to so-called "stealth restatements" which are instances when restated financials are disclosed only in a periodic filing with the SEC.;The first chapter analyzes the decision to file a stealth restatement. Using data from 2000--2010, I identify a variety of factors that are associated with the decision to file a stealth restatement. The models control for a number of factors previously used to explain financial restatements. I find that internal and external corporate governance mechanisms are significantly associated with the decision to file a stealth restatement. I also find that restatement specific factors such as materiality or the number of reporting periods affected influence misstatement disclosure source. I am unable to conclude that management is acting strategically in selecting where to disclose misstatements but offer several caveats and alternative explanations.;The second chapter analyzes how managerial compensation affects the decision to file stealth restatements. I argue that the attenuated market response to stealth restatements provides management with an incentive to circumvent SEC disclosure requirements because it preserves the value of equity grants. Contrary to my expectations, I find that options wealth is negatively associated with the decision to file stealth restatements. However, I find that this association is nonlinear suggesting that managerial compensation contracts need to be constructed carefully in order to align managerial and stakeholder interests. This result is important and has implications for the broader academic literature on managerial compensation and aggressive financial reporting practices.;The third chapter analyzes how factors that are associated with the decision to file a stealth restatement change in response to the various disclosure regimes mandated by the SEC. The SEC first tried to eliminate the practice of filing stealth restatement in August 2004. Some years later, the SEC was advised to eliminate the practice once and for all. Still, the practice of filing stealth restatements persists. I find that the predictive value of the estimated models declines with each effort to strengthen the disclosure requirements. In the most recent portion of the analyzed sample, I am unable to distinguish between issuers that elect to file stealth restatements and those that file Form 8-K. Despite efforts to the contrary, this result resembles a "race to the bottom" and has important implications for financial reporting quality.
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