This paper investigates the reputational penalties faced by managers of firms that announce earnings restatements. The authors examine management turnover and the subsequent employment prospects of displaced managers at firms that restated their earnings in 1997 or 1998. Contrary to prior research, which found no increased turnover following GAAP violations or corporate fraud, the authors find that 60% of restating firms experience at least one top manager turnover within 24 months, compared to 35% among matched control firms. The displaced managers from restating firms have poorer employment prospects compared to those from control firms. These findings suggest that both corporate boards and the external labor market impose significant penalties on managers for violating GAAP, and that private penalties for GAAP violations may serve as partial substitutes for public enforcement. The study also highlights the importance of recent changes in corporate governance and monitoring mechanisms, which may have increased the likelihood of managerial discipline following GAAP violations.This paper investigates the reputational penalties faced by managers of firms that announce earnings restatements. The authors examine management turnover and the subsequent employment prospects of displaced managers at firms that restated their earnings in 1997 or 1998. Contrary to prior research, which found no increased turnover following GAAP violations or corporate fraud, the authors find that 60% of restating firms experience at least one top manager turnover within 24 months, compared to 35% among matched control firms. The displaced managers from restating firms have poorer employment prospects compared to those from control firms. These findings suggest that both corporate boards and the external labor market impose significant penalties on managers for violating GAAP, and that private penalties for GAAP violations may serve as partial substitutes for public enforcement. The study also highlights the importance of recent changes in corporate governance and monitoring mechanisms, which may have increased the likelihood of managerial discipline following GAAP violations.