1326 Steinberg Hall-Dietrich Hall
3620 Locust Walk
Philadelphia, PA 19104-6365
Research Interests: cost accounting, intangible assets, performance measurement
Links: CV
Professor Ittner’s research focuses on the design, implementation, and performance consequences of performance measurement, cost management, and enterprise risk management systems. His articles have been published in the Harvard Business Review and leading academic accounting, marketing, and operations management journals. He is an editor of The Accounting Review, and has served as senior editor at Production and Operations Management and associate editor for Accounting, Organizations and Society, Management Science, and several other academic journals. His work on the association between customer satisfaction measures and financial performance received the American Accounting Association’s Notable Contribution to Management Accounting Literature Award.
Professor Ittner teaches the undergraduate management accounting core course, an MBA cost management elective, and executive education sessions on cost accounting and marketing metrics. In addition, he runs management accounting doctoral courses for students from throughout the United States and Europe. He is the recipient of several MBA teaching awards.
Professor Ittner received his BS from California State University, Long Beach, his MBA from UCLA, and a Doctorate in Business Administration from Harvard University.
Joseph Moran, Pablo Casas-Arce, Christopher D. Ittner, F. Asis Martinez-Jerez (Working), Moderators of Control System Cascade Effects.
Carolyn Deller, Christopher D. Ittner, Hami Amiraslani, Thomas Keusch (Working), The Importance of Directors’ Information Access: Evidence from Board Risk Reporting.
Carolyn Deller, Christopher D. Ittner, Hami Amiraslani, Thomas Keusch (Working), Board Risk Oversight and Environmental and Social Responsibility.
Abstract: We study the relation between board risk oversight and environmental and social (E&S) performance. Our quest is motivated by heightened awareness about E&S risks and growing calls for their inclusion in the purview of board risk oversight. Using a novel proprietary dataset on board risk oversight for an international sample, we find that firms with more extensive board risk oversight are more likely to institute E&S compensation, set environmental (but not social) targets, adopt policies that address E&S risks and opportunities, and issue an E&S report. Our exploratory evidence also shows that more extensive board risk oversight is associated with better environmental outcomes, specifically lower monetized environmental costs, but worse social outcomes, namely lower monetized employee benefits and a higher likelihood of social risk incidents. Further analyses indicate that E&S risk incidents materialize when boards focus on mitigating financial risks, suggesting that risk oversight is plausibly analogous to a constrained optimization problem whereby risk exposures are prioritized and receive different degrees of oversight consideration by the board.
Christopher D. Ittner and Jeremy Michels (2017), Risk-Based Forecasting and Planning and Management Earnings Forecasts, Review of Accounting Studies, 11 (3), pp. 1005-1047. 10.1007/s11142-017-9396-0
Abstract: This study examines the association between a firm’s internal information environment and the accuracy of its externally-disclosed management earnings forecasts. Internally, firms use forecasts to plan for uncertain futures. The risk management literature argues that integrating risk-related information into forecasts and plans can improve a firm’s ability to forecast future financial outcomes. We investigate whether this internal information manifests itself in the accuracy of external earnings guidance. Using detailed survey data and publicly-disclosed management earnings forecasts from a sample of publicly-traded U.S. companies, we find that more sophisticated risk-based forecasting and planning processes are associated with smaller earnings forecast errors and narrower forecast widths. These associations hold across a variety of different planning horizons (ranging from annual budgeting to long-term strategic planning), providing empirical support for the theoretical link between internal information quality and the quality of external disclosures.
Christopher D. Ittner and Thomas Keusch (Working), The Influence of Board of Directors’ Risk Oversight on Risk Management Maturity and Firm Risk-Taking.
H. Chang, J. Chen, R. Duh, Christopher D. Ittner (Under Revision), “Is Sunlight the Best Disinfectant? Evidence From Differential Auditor Fee Disclosure Requirements.
Francesca Franco, Christopher D. Ittner, Oktay Urcan (2016), Determinants and Trading Performance of Equity Deferrals by Corporate Outside Directors, Management Science, Forthcoming ().
Abstract: This study investigates the determinants and trading performance of outside directors’ equity deferrals, which represent the choice to convert part or all of their annual cash compensation into deferred company stock. Using a large sample of S&P 1500 firms that allowed directors to defer their cash fees into equity between 1999 and 2009, we find significant associations between equity deferral choices and specific features of the director compensation plans, proxies for directors’ outside wealth diversification, and future firm stock market performance. Trading performance analyses indicate that outside directors earn substantial abnormal returns from their deferrals, with a significant proportion of the deferral transactions occurring during blackout periods. These results are consistent with companies structuring director equity deferral plans to circumvent U.S. Securities and Exchange Commission Rule 10b-5’s trading restrictions.
Christopher D. Ittner and D. Oyon (Under Revision), CFO Risk Ownership and the Influence of the Finance Function on Enterprise Risk Management.
Joseph Gerakos, Christopher D. Ittner, Frank Moers (Under Revision), Compensation Objectives and Business Unit Pay Strategy.
Christopher Armstrong, Yuen Kit Chau, Christopher D. Ittner, Liang (Jason) Xiao (Working), Internal Versus External Earning per Share Goals and CEO Incentives.
Strategic Cost Analysis is the process of analyzing and managing costs in order to improve the strategic position of the business. This goal can be accomplished by having a thorough understanding of which activities and costs support an organization's strategic position and which activities and costs either weaken it or have no impact. Subsequent cost management efforts can then focus on reducing or limiting expenditures on activities that add little or no strategic value, while increasing expenditures on activities that support the strategic position of the organization. Performance can then be evaluated to ensure that the chosen actions are taken, and that these actions are yielding improved strategic performance. Throughout the course, a strategic cost analysis and management framework will be applied across functions and organizations to highlight the cost analysis and performance evaluation methods available to forecast financial performance and improve strategic position.
This course covers the financial, managerial, and tax accounting issues and tools relevant to private, entrepreneurial companies as they progress from the earliest stages of the business through to the company’s exit, typically through a strategic buyer, a private equity firm, or via an IPO. Topics include the choice of organizational form; the development of the initial accounting infrastructure; the accounting issues that are frequently faced by entrepreneurs such as accounting for intangible assets, employee compensation, revenue recognition, and financing; the development of management and internal control systems; the establishment of monthly and yearly budgeting, financial forecasting, and cash management processes; and the accounting information required for fundraising and going public. The class is designed for students who intend to own, work for, or invest in entrepreneurial companies.
Intensive reading and study with some research under the direction of a faculty member. Approval from one of the departmental advisers must be obtained before registration. Also a 3.4 average in major related subjects required.
This course focuses on ways to improve cost efficiency without compromising quality or growth. Whether an organization is seeking to make immediate cost cuts, better position the business for future growth, or both, it needs the right mix of intelligent cost optimization measures tailored to its unique business needs. This strategic approach to cost management goes beyond cost cutting and instead emphasizes new value creation and continuous cost improvement. This course covers the key factors and methods involved in choosing and analyzing cost structures, and the cost management practices that can be strategically applied across the various functions of a business organization to analyze and forecast costs and to improve organizational performance. The course emphasizes the methods available to measure and evaluate costs for planning, forecasting, and decision-making. The material is designed for managers and consultants who will be involved in implementing cost management activities, as well as analysts, investors, and strategic planners involved in competitive cost analysis and financial forecasting.
This course covers the financial, managerial, and tax accounting issues and tools relevant to private, entrepreneurial companies as they progress from the earliest stages of the business through to the company’s exit, typically through a strategic buyer, a private equity firm, or via an IPO. Topics include the choice of organizational form; the development of the initial accounting infrastructure; the accounting issues that are frequently faced by entrepreneurs such as accounting for intangible assets, employee compensation, revenue recognition, and financing; the development of management and internal control systems; the establishment of monthly and yearly budgeting, financial forecasting, and cash management processes; and the accounting information required for fundraising and going public. The class is designed for students who intend to own, work for, or invest in entrepreneurial companies.
This is Part I of a theoretical and empirical literature survey course covering topics that include corporate disclosure, cost of capital, incentives, compensation, governance, financial intermediation, financial reporting, tax, agency theory, cost accounting, capital structure, international financial reporting, analysts, and market efficiency.
Careful planning can position firms for transformational growth once they emerge from bankruptcy, write Wharton’s Christopher Ittner and his co-authors.…Read More
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