The Information Content of Annual Earnings Releases
Author | : Linda Smith Bamber |
Publisher | : |
Total Pages | : 452 |
Release | : 1983 |
Genre | : Investments |
ISBN | : |
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Author | : Linda Smith Bamber |
Publisher | : |
Total Pages | : 452 |
Release | : 1983 |
Genre | : Investments |
ISBN | : |
Author | : Gordon Douglas Richardson |
Publisher | : Ann Arbor, Mich. : University Microfilms International |
Total Pages | : 350 |
Release | : 1983 |
Genre | : Accounting |
ISBN | : |
Author | : Mark L. DeFond |
Publisher | : |
Total Pages | : 46 |
Release | : 2006 |
Genre | : |
ISBN | : |
We draw on the investor protection literature to identify structural factors in the financial reporting environment that are likely to explain cross-country differences in the information content of annual earnings announcements. Using data from over 50,000 annual earnings announcements in 26 countries, we find that annual earnings announcements are more informative in countries with higher quality earnings or better enforced insider trading laws, and that annual earnings announcements are less informative in countries with more frequent interim financial reporting. We also find that, on average, earnings announcements are more informative in countries with strong investor protection institutions.
Author | : Wayne R. Landsman |
Publisher | : |
Total Pages | : 38 |
Release | : 2012 |
Genre | : |
ISBN | : |
In 1968, Beaver published his seminal paper on the information content of earnings announcements, establishing that both trading volume and return volatility increase at the time of earnings announcements. Thirty-some years after Beaver's study, concerns have been raised about a perceived degradation in the informativeness of earnings because of the increasing availability of timely non-accounting information and the increasing rate of technological innovation and change not reflected in the accounting system in a timely manner.In this paper we examine changes over the past thirty years in the information content of earnings using the two metrics from Beaver (1968): abnormal trading volume and volatility. In contrast to the conventional wisdom, we find no evidence of a decline in the informativeness of accounting information over the past thirty years, as measured by both abnormal trading volume and return volatility around quarterly earnings announcements. If anything, our results suggest an increase over time in the informativeness of quarterly earnings announcements. Variables reflecting changes in firm-specific factors account for a portion of the observed increase.
Author | : Edward Bradley Grant |
Publisher | : |
Total Pages | : 296 |
Release | : 1977 |
Genre | : Corporations |
ISBN | : |
Author | : Andrews Oppong |
Publisher | : |
Total Pages | : 139 |
Release | : 1976 |
Genre | : Corporation reports |
ISBN | : |
Author | : Angela K. Davis |
Publisher | : |
Total Pages | : 31 |
Release | : 2011 |
Genre | : |
ISBN | : |
Earnings press releases are the primary mechanism by which managers announce quarterly earnings and make other concurrent disclosures to investors and other stakeholders. A largely unexplored element of earnings press releases is the language that managers use throughout the press release, which we argue provides a unifying framework for these disclosures and an opportunity for managers to signal, both directly and more subtly, their expectations about future performance. We analyze the full texts of approximately 23,000 earnings press releases issued between 1998 and 2003 and examine whether the language used in these earnings press releases provides a signal about expected future firm performance and whether the market responds to this signal. Using categories derived from linguistic theory, we count words characterized as optimistic and pessimistic and construct a measure of managers' net optimistic language for each earnings press release. We find that this measure is positively associated with future ROA and generates a significant market response in a short window around the earnings announcement date. We include in our models the earnings surprise as well as other quantifiable, concurrent disclosures identified in prior research as associated with the market's reaction to earnings press releases. Our results support the premise that earnings press release language provides a signal regarding managers' future earnings expectations to the market and that the market responds to this signal. We interpret our evidence to suggest that managers use language in earnings press releases to communicate credible information about expected future firm performance.
Author | : Khalid Elouafa |
Publisher | : |
Total Pages | : 13 |
Release | : 2018 |
Genre | : |
ISBN | : |
The objective of our work is to study the information content of accounting results of listed companies in the Casablanca Stock Exchange. Applying the methodology adopted by Beaver (1968), we analyze the market reaction, in terms of changes in prices and volumes around the announcement of annual earnings. Our study focuses on 75 companies listed on the Casablanca Stock Exchange for the period [2010 to 2015]. It accounts for the presence of an informational content for the accounting results around the announcement date. Thus, this confirms the hypothesis of financial market efficiency in its semi-strong form (Fama, 1970) and the results obtained in other financial markets (US, French, Chinese ...).
Author | : Wayne R. Landsman |
Publisher | : |
Total Pages | : 59 |
Release | : 2012 |
Genre | : |
ISBN | : |
This study examines whether the information content of earnings announcements--abnormal return volatility and abnormal trading volume -- increases in countries following mandatory IFRS adoption, and conditions and mechanisms through which increases occur. Findings suggest information content increased in 16 countries that mandated adoption of IFRS relative to 11 that maintained domestic accounting standards, although the effect of mandatory IFRS adoption depends on the strength of legal enforcement in the adopting country. Utilizing a path analysis methodology, we find evidence of three mechanisms through which IFRS adoption increases information content: reducing reporting lag, increasing analyst following, and increasing foreign investment.
Author | : Ray Barrell |
Publisher | : Cambridge University Press |
Total Pages | : 316 |
Release | : 2000-06-15 |
Genre | : Business & Economics |
ISBN | : 9780521780315 |
The book compares and explains differences in levels of incomes among industrialised countries.