252 Notes
12.John Burr Williams,The Theory of Investment Value(1st ed. 1938; rev. ed. Fra-
ser, 1997).
13.Robert Shiller,Irrational Exuberance(Princeton University Press, 2000) (not-
ing the studies referred to and reporting on others done directly that show
slightly lower expected returns), 52–55; Graham,Intelligent Investor, 122.
14.Buffett and Cunningham,Essays,85.
15.Stern Stewart, the firm that trademarked the term “economic value added,”
publishes volumes of material on the concept, including G. Bennett Stewart
III, “EVA: Fact and Fantasy,”Journal of Applied Corporate Finance,vol.7
(1994).
16.The Coca-Cola Company defines “economic value added” in a glossary in its
annual report as year-to-year growth in after-tax operating income in excess of
a varying estimated charge for average operating capital employed.
17.Graham,Interpretation, 75–76.
Chapter 10
1.David Burgstahler and Ilia Dichev, “Earnings Management to Avoid Earnings
Decreases and Losses,”Journal of Accounting and Economics, vol. 24 (1997).
2.Michael Schroeder, “SEC to Adopt Disclosure Rules for Companies,”TheWall
Street Journal, December 16, 1999.
3.New York Stock Exchange Listed Company Manual, Section 303.01, Audit Com-
mittees (available from http://www.nyse.com/listed). Big accounting firms used
these rules and recommendations to formulate statements of audit committee
standards. For example, see PriceWaterhouseCoopers,Audit Committees: Best
Practices for Protecting Shareholder Interests(1999); KMPG,Shaping the Audit
Committee Agenda(1999).
4.Graham’s lampooning appears in Warren E. Buffett and Lawrence A. Cun-
ningham,The Essays of Warren Buffett: Lessons For Corporate America(The
Cunningham Group, 1997), 159–65. Briloff’s wor kincludesMore Debits Than
Credits(Harper & Row, 1976) andUnaccountable Accounting(Harper & Row,
1972).
5.Some of these charade discussions are adapted from Lawrence A. Cunningham,
Introductory Accounting and Finance for Lawyers(2nd ed. West Group, 1999).
6.Buffett and Cunningham,Essays, 193.
7.Benjamin Graham,The Intelligent Investor(1st ed. 1949; 4th rev. ed. Harper &
Row, 1973), 167.Chapter 11
1.Benjamin Graham,The Intelligent Investor(1st ed. 1949; 4th rev. ed. Harper &
Row, 1973), 155.
2.Ibid., 286.
3.Warren E. Buffett and Lawrence A. Cunningham,The Essays of Warren Buffett: