The Economic Consequences of Disclosure Regulation: Evidence from Regulation G
Item
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Title
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The Economic Consequences of Disclosure Regulation: Evidence from Regulation G
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Identifier
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d_2009_2013:67572f7b1b3b:10928
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identifier
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11164
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Creator
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Pawlewicz, Robert J.,
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Contributor
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Donal Byard
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Date
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2011
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Language
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English
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Publisher
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City University of New York.
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Subject
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Accounting | Earnings Announcements | Earnings Announcement Timing | Earnings Response Coefficients | Pro Forma Earnings | Regulation G
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Abstract
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This dissertation examines the economic consequences of Regulation G, which was created to address the use of non-GAAP financial measures in earnings announcement press releases. Specifically, I examine the effect of Reg G on both the timing and disclosure content of earnings announcements in addition to investor responses to these announcements. I find that, after Reg G, firms issued less timely earnings announcements with fiscal yearend announcements coming, on average, more than 5 days later. Additionally, I find evidence of a decrease in the likelihood of firms disclosing pro forma earnings but an increase in the likelihood of disclosing additional GAAP financial statements after the adoption of Reg G. I also find that investors' responses to earnings, as measured by the change in earnings response coefficients (ERC), increased significantly in the year after Reg G became effective. Further, using the approach of Ball and Shivakumar (2008), I find that the relative informational role of earnings announcements increased significantly after Reg G. The main results are robust to controlling for the amount and type of disclosures included in earnings announcements and a host of sensitivity analyses and alternate specifications, including controls for other concurrent effects of the Sarbanes-Oxley Act. This dissertation provides evidence that Reg G affected the timeliness and disclosures of earnings announcements while increasing investors' perceptions of earnings reliability. These effects reflect both intended and unintended consequences of regulating an important avenue for accounting disclosures.
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Type
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dissertation
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Source
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2009_2013.csv
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degree
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Ph.D.
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Program
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Business
