scholarly journals The Information Content of Risk Factor Disclosures in Quarterly Reports

2015 ◽  
Vol 29 (4) ◽  
pp. 887-916 ◽  
Author(s):  
Joshua J. Filzen
Keyword(s):  
Risk Factors ◽  
Risk Factor ◽  
Abnormal Returns ◽  
Data Availability ◽  
Bad News ◽  
Filing Date ◽  
Unexpected Earnings ◽  
Disclosure Requirement ◽  
Jel Classifications ◽  
Negative Earnings

SYNOPSIS I examine whether recently required risk factor update disclosures in quarterly reports provide investors with timely information regarding potential future negative economic events. Specifically, I examine whether risk factor updates in 10-Q filings are associated with negative abnormal returns at the time the updates are disclosed and whether quarterly updates are followed by negative earnings shocks. I find that firms presenting updates to their risk factor disclosures have significantly lower abnormal returns around the filing date of the 10-Q relative to firms without updates. I also find that firms with updates to their risk factors section have significantly lower future unexpected earnings and are more likely to experience future extreme negative earnings shocks. These findings suggest that the recent disclosure requirement mandated by the SEC was successful in generating timely disclosure of bad news. JEL Classifications: M41; M48; D80; G18. Data Availability: Please contact the author for data availability.

Investor Sentiment for Corporate Social Performance

2018 ◽  
Vol 94 (4) ◽  
pp. 401-420 ◽  
Author(s):  
James P. Naughton ◽  
Clare Wang ◽  
Ira Yeung
Keyword(s):  
Corporate Social Performance ◽  
Social Performance ◽  
Abnormal Returns ◽  
Investor Sentiment ◽  
Data Availability ◽  
Time Varying ◽  
The Public ◽  
Valuation Uncertainty ◽  
Corporate Social ◽  
Jel Classifications

ABSTRACT We document time-varying investor sentiment for corporate social responsibility (CSR) performance. We show that announcements of CSR activities generate positive abnormal returns during periods when investors place a valuation premium on CSR performance. In addition, we find that firms boost CSR performance in response to investor sentiment, and that this response is more pronounced for those firms that are more inclined to respond to investor sentiment due to valuation uncertainty and investor horizon. Our results suggest that investor sentiment plays a role in firms' commitment to CSR. JEL Classifications: M41; D82; G14; G30; G31; G32; G34. Data Availability: Data are available from the public sources cited in the text.

scholarly journals Relevant but Delayed Information in Negotiated Audit Fees

2014 ◽  
Vol 33 (4) ◽  
pp. 95-117 ◽  
Author(s):  
Karl E. Hackenbrack ◽  
Nicole Thorne Jenkins ◽  
Mikhail Pevzner
Keyword(s):  
Information Asymmetry ◽  
Positive Association ◽  
Audit Fees ◽  
Data Availability ◽  
Bad News ◽  
Specific Knowledge ◽  
Delayed Information ◽  
Audit Fee ◽  
News Events ◽  
Jel Classifications

SUMMARY: Audit fee negotiations conclude with the signing of an engagement letter, typically the first quarter of the year under audit. Yet investors do not learn the audit fee paid until disclosed in the following year's definitive proxy statement. We conjecture that negotiated audit fees impound auditors' consequential private, client-specific knowledge about “bad news” events investors will learn eventually. We demonstrate that a proxy for the year-to-year change in the negotiated audit fee has an economically meaningful positive association with proxies for public realizations of “bad news” events that occur during the roughly 12-month period between the negotiation of the audit fee and the disclosure of the audit fee paid. Our results suggest that negotiated audit fees contain information meaningful to investors and that if disclosed proximate to the signing of the engagement letter instead of the following year, information asymmetry between managers and investors would be reduced. JEL Classifications: G19, D89, M40. Data Availability: Available from public sources identified in the text.

Do Career Concerns Affect the Delay of Bad News Disclosure?

2017 ◽  
Vol 93 (2) ◽  
pp. 61-95 ◽  
Author(s):  
Stephen P. Baginski ◽  
John L. Campbell ◽  
Lisa A. Hinson ◽  
David S. Koo
Keyword(s):  
Empirical Evidence ◽  
Career Concerns ◽  
Data Availability ◽  
Bad News ◽  
Severance Pay ◽  
The Public ◽  
Ex Ante ◽  
Theoretical Evidence ◽  
The Impact ◽  
Jel Classifications

ABSTRACT Theory argues that career concerns (i.e., concerns about the impact of current performance on contemporaneous and future compensation) encourage managers to withhold bad news disclosure. However, empirical evidence regarding the extent to which a manager's career concerns are associated with a delay in bad news disclosure is limited. Across multiple proxies for career concerns, we find that the extent to which managers delay bad news is positively associated with their level of career concerns. Then, we hand-collect data on a compensation contract that firms use to reduce CEOs' career concerns (i.e., ex ante severance pay agreements). We find that if managers receive a sufficiently large payment in the event of dismissal, they no longer delay the disclosure of bad news. Overall, our findings support prior theoretical evidence that managers delay bad news disclosure due to career concerns and suggest a mechanism through which firms can mitigate the delay. JEL Classifications: M12; M41. Data Availability: Data are available from the public sources cited in the text.

Can Investors Detect Managers' Lack of Spontaneity? Adherence to Predetermined Scripts during Earnings Conference Calls

2015 ◽  
Vol 91 (1) ◽  
pp. 229-250 ◽  
Author(s):  
Joshua Lee
Keyword(s):  
Firm Performance ◽  
Abnormal Returns ◽  
Bad News ◽  
Conference Calls ◽  
Negatively Associated ◽  
Future Earnings ◽  
Accounting Performance ◽  
Market Participants ◽  
Bid Ask Spreads ◽  
Jel Classifications

ABSTRACT This paper examines whether market participants infer negative information about future unexpected firm performance when managers adhere to predetermined scripts when responding to questions during earnings conference calls. I argue that managers respond to questions from prepared scripts to avoid the disclosure of bad news. Using a measure of the adherence to predetermined language, I provide evidence that a lack of spontaneity is negatively associated with the market reaction to the call and with the abnormal returns in the subsequent quarter. I further find that analysts downgrade their forecasts following these calls. I also provide evidence that adherence to predetermined language is negatively associated with future unexpected firm accounting performance, supporting investors' negative response to it. Finally, I find that bid-ask spreads increase and firms are less likely to guide future earnings when managers adhere to the predetermined language of a script, suggesting that firms provide less information, not more, during these calls. JEL Classifications: G14; M40; M41.

Hemmkörperentwicklung bei Hämophilie-Patienten nach Präparate wechsel

2012 ◽  
Vol 32 (S 01) ◽  
pp. S39-S42 ◽  
Author(s):  
S. Kocher ◽  
G. Asmelash ◽  
V. Makki ◽  
S. Müller ◽  
S. Krekeler ◽  
...  
Keyword(s):  
Risk Factors ◽  
Risk Factor ◽  
Observational Study ◽  
Retrospective Observational Study ◽  
Frequent Change ◽  
Patient Age ◽  
Treatment Regimens ◽  
Patient Âgé ◽  
The Relationship ◽  
Observation Period

SummaryThe retrospective observational study surveys the relationship between development of inhibitors in the treatment of haemophilia patients and risk factors such as changing FVIII products. A total of 119 patients were included in this study, 198 changes of FVIII products were evaluated. Results: During the observation period of 12 months none of the patients developed an inhibitor, which was temporally associated with a change of FVIII products. A frequent change of FVIII products didn’t lead to an increase in inhibitor risk. The change between plasmatic and recombinant preparations could not be confirmed as a risk factor. Furthermore, no correlation between treatment regimens, severity, patient age and comorbidities of the patients could be found.

Risk Factors of Collateralized Loan Obligations and Corporate Bonds

2020 ◽  
Vol 32 (6) ◽  
pp. 347-355
Author(s):  
Mark Wahrenburg ◽  
Andreas Barth ◽  
Mohammad Izadi ◽  
Anas Rahhal
Keyword(s):  
Risk Factors ◽  
Risk Factor ◽  
Asset Pricing ◽  
Systemic Risk ◽  
Corporate Bonds ◽  
Risk Exposure ◽  
Expected Returns ◽  
Yield Spreads ◽  
Pricing Factors ◽  
Return Difference

AbstractStructured products like collateralized loan obligations (CLOs) tend to offer significantly higher yield spreads than corporate bonds (CBs) with the same rating. At the same time, empirical evidence does not indicate that this higher yield is reduced by higher default losses of CLOs. The evidence thus suggests that CLOs offer higher expected returns compared to CB with similar credit risk. This study aims to analyze whether this return difference is captured by asset pricing factors. We show that market risk is the predominant risk factor for both CBs and CLOs. CLO investors, however, additionally demand a premium for their risk exposure towards systemic risk. This premium is inversely related to the rating class of the CLO.

Cardiovascular Risk in Perimenopausal Women

2019 ◽  
Vol 17 (6) ◽  
pp. 591-594 ◽  
Author(s):  
John C. Stevenson ◽  
Sophia Tsiligiannis ◽  
Nick Panay
Keyword(s):  
Risk Factors ◽  
Risk Factor ◽  
Ovarian Function ◽  
Density Lipoprotein ◽  
Premenopausal Women ◽  
Therapeutic Interventions ◽  
Additional Risk Factor ◽  
Chd Risk ◽  
Perimenopausal Women ◽  
Chd Risk Factors

Cardiovascular disease, and particularly coronary heart disease (CHD), has a low incidence in premenopausal women. Loss of ovarian hormones during the perimenopause and menopause leads to a sharp increase in incidence. Although most CHD risk factors are common to both men and women, the menopause is a unique additional risk factor for women. Sex steroids have profound effects on many CHD risk factors. Their loss leads to adverse changes in lipids and lipoproteins, with increases being seen in low density lipoprotein (LDL) cholesterol and triglycerides, and decreases in high density lipoprotein (HDL) cholesterol. There is a reduction in insulin secretion and elimination, but increases in insulin resistance eventually result in increasing circulating insulin levels. There are changes in body fat distribution with accumulation in central and visceral fat which links to the other adverse metabolic changes. There is an increase in the incidence of hypertension and of type 2 diabetes mellitus, both major risk factors for CHD. Oestrogens have potent effects on blood vessels and their loss leads to dysfunction of the vascular endothelium. All of these changes result from loss of ovarian function contributing to the increased development of CHD. Risk factor assessment in perimenopausal women is recommended, thereby permitting the timely introduction of lifestyle, hormonal and therapeutic interventions to modify or reverse these adverse changes.

Surviving “Risk Factor Frenzy”: The Perils of Incorrectly Applying Epidemiological Research in Health Education and Promotion

2002 ◽  
Vol 21 (1) ◽  
pp. 83-100 ◽  
Author(s):  
Jonathan I. Robison ◽  
Gregory Kline
Keyword(s):  
Risk Factors ◽  
Risk Factor ◽  
Health Education ◽  
Health Professionals ◽  
Lifestyle Change ◽  
Negative Consequences ◽  
Epidemiological Research ◽  
Health Practitioners ◽  
Health Education And Promotion

In health education and promotion, “risk factors” for disease gathered from epidemiological research form the basis from which the majority of recommendations to individuals for lifestyle change are made. Unfortunately, many health practitioners are unaware that this type of research was never intended to be applied to individuals. The result is ongoing public confusion and anxiety concerning health recommendations and a loss of credibility for health professionals. This article: 1) briefly reviews the most commonly encountered limitations inherent in epidemiological research; 2) explores the problems and potential negative consequences of incorrectly applying epidemiological research in health education and promotion; and 3) makes recommendations to help health practitioners more skillfully interpret and incorporate into their work findings from epidemiological research.

Knowledge, awareness and perceptions of diabetes mellitus among the Saudi population

2020 ◽  
Vol 9 (6) ◽  
pp. 413-422
Author(s):  
Muhammad H Mujammami ◽  
Abdulaziz A Alodhayani ◽  
Mohammad Ibrahim AlJabri ◽  
Ahmad Alhumaidi Alanazi ◽  
Sultan Sayyaf Alanazi ◽  
...  
Keyword(s):  
Diabetes Mellitus ◽  
Risk Factors ◽  
Social Media ◽  
Risk Factor ◽  
Healthcare Workers ◽  
Health Workers ◽  
Saudi Population ◽  
Limited Data ◽  
High Prevalence ◽  
Associated Risk Factors

Background: High prevalence of undiagnosed cases of diabetes mellitus (DM) has increased over the last two decades, most patients with DM only become aware of their condition once they develop a complication. Limited data are available regarding the knowledge and awareness about DM and the associated risk factors, complications and management in Saudi society. Aim: This study aimed to assess knowledge of DM in general Saudi society and among Saudi healthcare workers. Results: Only 37.3% of the participants were aware of the current DM prevalence. Obesity was the most frequently identified risk factor for DM. Most comparisons indicated better awareness among health workers. Conclusion: A significant lack of knowledge about DM in Saudi society was identified. Social media and educational curriculum can improve knowledge and awareness of DM.

Interim Reporting Frequency and the Mispricing of Accruals

2018 ◽  
Vol 32 (3) ◽  
pp. 29-47
Author(s):  
Shou-Min Tsao ◽  
Hsueh-Tien Lu ◽  
Edmund C. Keung
Keyword(s):  
Financial Reporting ◽  
Stock Prices ◽  
Data Availability ◽  
Financial Reports ◽  
Regulatory Changes ◽  
Sample Composition ◽  
Reporting Frequency ◽  
Over Time ◽  
Jel Classifications ◽  
Accrual Mispricing

SYNOPSIS This study examines the association between mandatory financial reporting frequency and the accrual anomaly. Based on regulatory changes in reporting frequency requirements in Taiwan, we divide our sample period into three reporting regimes: a semiannual reporting regime from 1982 to 1985, a quarterly reporting regime from 1986 to 1987, and a monthly reporting regime (both quarterly financial reports and monthly revenue disclosure) from 1988 to 1993. We find that although both switches (from the semiannual reporting regime to the quarterly reporting regime and from the quarterly reporting regime to the monthly reporting regime) hasten the dissemination of the information contained in annual accruals into stock prices and reduce annual accrual mispricing, the switch to monthly reporting has a lesser effect. Our results are robust to controlling for risk factors, transaction costs, and potential changes in accrual, cash flow persistence, and sample composition over time. These results imply that more frequent reporting is one possible mechanism to reduce accrual mispricing. JEL Classifications: G14; L51; M41; M48. Data Availability: Data are available from sources identified in the paper.

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