Unexpected Consequences: The Effects on Non-Accelerated Filers of an Accelerated Filing Deadline and Sox Section 404

2020 ◽  
Author(s):  
Bei Dong ◽  
Stefanie L. Tate ◽  
Le Emily Xu
Keyword(s):  
Section 404 ◽  
Unexpected Consequences

Accelerated Filing Deadlines, Internal Controls, and Financial Statement Quality: The Case of Originating Misstatements

2015 ◽  
Vol 29 (3) ◽  
pp. 551-575 ◽  
Author(s):  
Colleen M. Boland ◽  
Scott N. Bronson ◽  
Chris E. Hogan
Keyword(s):  
Internal Control ◽  
Internal Controls ◽  
Data Availability ◽  
Financial Statement ◽  
Similar Increase ◽  
Section 404 ◽  
Regulatory Changes ◽  
Rule Change ◽  
Initial Decrease

SYNOPSIS We examine whether regulations requiring accelerated filing deadlines and internal control reporting and testing affect financial statement reliability. Unlike prior research, we examine whether these regulatory changes are associated with an increase in the likelihood that misstatements originate in the period following the respective change. If the implementation of these rules causes a misstatement, then the misstatement would most likely occur in the period immediately following the rule change. We provide evidence that accelerated filers (AFs) experience an increase in the likelihood of an originating misstatement following the acceleration of filing deadlines from 90 to 75 days. Large accelerated filers (LAFs), however, do not experience a similar increase following this acceleration or the subsequent acceleration from 75 to 60 days. After the implementation of the SOX Section 404 internal control requirements, we find that the likelihood of an originating misstatement declined for AFs but not for LAFs. Taken together, the findings suggest that, although AFs experienced an initial decrease in financial statement reliability, this decrease was temporary. Data Availability: Data are publicly available from the sources identified in the text.

Unexpected Consequences: The Effects on Non-Accelerated Filers of an Accelerated Filing Deadline and SOX Section 404

2020 ◽  
Vol 34 (3) ◽  
pp. 87-112
Author(s):  
Bei Dong ◽  
Stefanie L. Tate ◽  
Le Emily Xu
Keyword(s):  
Resource Allocation ◽  
Financial Statements ◽  
Financial Statement ◽  
Negative Consequences ◽  
Section 404 ◽  
Auditor Change ◽  
Time Required ◽  
Allocation Decisions ◽  
Jel Classifications ◽  
Resource Allocation Decisions

SYNOPSIS Regulations implemented by the SEC in 2003 and 2004 simultaneously shortened the financial statement filing deadlines and increased the time required for both the preparation of financial statements and the related audit of accelerated filers (AFs). However, there were indirect, unintended negative consequences for companies not subject to the regulations, namely, non-accelerated filers (NAFs). The new regulations imposed strains on auditor resources requiring auditors to make resource allocation decisions that negatively affected NAFs. We find that NAFs with an auditor who had a high proportion of AF clients (high-AF) had longer audit delays after the regulations were implemented than NAFs of an auditor with a low proportion of AF clients (low-AF). Further, we document that NAFs with high-AF auditors were more likely to change auditors than NAFs with low-AF auditors. Finally, NAFs that switched to auditors with less AFs experienced shorter audit delays after the auditor change. JEL Classifications: M42; M48.

Investor Perceptions of Government Deregulation: Evidence from Section 404 of the Sarbanes-Oxley Act

2020 ◽  
Author(s):  
Benjamin W Hoffman ◽  
John L. Campbell ◽  
Jason L. Smith
Keyword(s):  
Financial Reporting ◽  
Government Regulation ◽  
Abnormal Returns ◽  
Reporting Quality ◽  
Internal Controls ◽  
Litigation Risk ◽  
Section 404 ◽  
Fraud Risk ◽  
Sarbanes Oxley ◽  
Public Company

We investigate the stock market's reaction to events leading up to the Securities and Exchange Commission's (SEC) and Public Company Accounting Oversight Board's (PCAOB) 2007 regulatory changes that reduced the scope of and documentation requirements for assessments of firms' internal controls over financial reporting (ICFR), as required by Section 404 of the Sarbanes-Oxley Act. The stated goal of these regulations was to reduce firms' and auditors' compliance costs with mandatory ICFR assessments, while maintaining the effectiveness of these assessments. We examine abnormal returns surrounding key dates leading to the passage of these regulations and offer two main findings. First, investors reacted negatively on key event dates, suggesting that investors viewed the regulations as likely to reduce financial reporting quality rather than to drive firm and audit efficiencies. Second, this negative market reaction is larger when ICFR effectiveness should matter most - when firms are more complex, have higher litigation risk, and greater fraud risk. In additional analysis, we find that restatements increase in the post-regulation time period, consistent with investors' concerns that the effect of the legislation would be a reduction in ICFR effectiveness. Overall, our results may imply that investors prefer stronger government regulation when it comes to the assessments of a firm's internal controls over financial reporting.

American Missionaries and Race

2018 ◽  
Author(s):  
Sarah Ruble
Keyword(s):  
Racial Difference ◽  
Cultural Imperialism ◽  
American Missionaries ◽  
History Of ◽  
Anglo American ◽  
Christian Message ◽  
Unexpected Consequences

When Europeans came to the Americas, they brought with them both Christian missionaries and notions of racial difference. Since that early encounter, the story of American missions has been intertwined with issues of race. Although some might suspect a rather simple story of missionary racism and others an account of the egalitarian effects of the Christian message, the history of missions and race is a story of competing impulses and unexpected consequences. Missionaries participated in the construction of race, they challenged racism, and they reified it. In some cases, racism twined with cultural imperialism, leading to a message and to methods that valorized Anglo-American, largely Protestant, culture. In others, concerns about racism led to larger critiques of missionary practice and US presence abroad.

scholarly journals Coronavirus and Immigration Detention in Europe: The Short Summer of Abolitionism?

2021 ◽  
Vol 10 (6) ◽  
pp. 226
Author(s):  
José A. Brandariz ◽  
Cristina Fernández-Bessa
Keyword(s):  
Late Summer ◽  
European Countries ◽  
Immigration Enforcement ◽  
Racial Justice ◽  
Immigration Detention ◽  
Migration Policies ◽  
Potential Impact ◽  
Detention Facilities ◽  
Unexpected Consequences

In managing the coronavirus pandemic, national authorities worldwide have implemented significant re-bordering measures. This has even affected regions that had dismantled bordering practices decades ago, e.g., EU areas that lifted internal borders in 1993. In some national cases, these new arrangements had unexpected consequences in the field of immigration enforcement. A number of European jurisdictions released significant percentages of their immigration detention populations in spring 2020. The Spanish administration even decreed a moratorium on immigration detention and closed down all detention facilities from mid-spring to late summer 2020. The paper scrutinises these unprecedented changes by examining the variety of migration enforcement agendas adopted by European countries and the specific forces contributing to the prominent detention decline witnessed in the first months of the pandemic. Drawing on the Spanish case, the paper reflects on the potential impact of this promising precedent on the gradual consolidation of social and racial justice-based migration policies.

Clean Water Act Section 404 and Coastal Marsh Sustainability

2014 ◽  
Vol 42 (5) ◽  
pp. 464-477 ◽  
Author(s):  
Beth Ravit ◽  
Judith S. Weis
Keyword(s):  
Clean Water Act ◽  
Coastal Marsh ◽  
Clean Water ◽  
Section 404

scholarly journals The fate of the unexpected: Consequences of misprediction assessed using ERP repetition effects

2021 ◽  
Vol 1757 ◽  
pp. 147290
Author(s):  
Melinh K. Lai ◽  
Joost Rommers ◽  
Kara D. Federmeier
Keyword(s):  
Repetition Effects ◽  
Unexpected Consequences
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