Comunicação em evento científico
Impression Management and Non-GAAP Disclosure in Earnings Announcements
Helena Isidro (Isidro, H.); Ana Marques (Marques, A.); Encarna Guillamon Saorin (Guillamon Saorin, E.);
Título Evento
International Accounting Section, American Accounting Association
Ano (publicação definitiva)
Estados Unidos da América
Mais Informação
We study market reactions to the disclosure of non-GAAP earnings measures, considering the level of impression management used around them in earnings announcement press releases and country-level effects. Our sample includes observations from the largest European firms, during the period of 2003 to 2009. We analyze the press releases to hand-collect the non-GAAP measures disclosed and create a score to measure the level of impression management used around them. Managers who exclude recurring earnings components from their self-constructed non-GAAP earnings figures use higher levels of impression management, which is consistent with the strategic use of impression management to hide the persistence of non-GAAP adjustments. Our market reaction tests indicate that investors are able to identify managers’ intentions and react negatively to the disclosure of non-GAAP information that is surrounded by high impression management. Moreover, investors’ reactions to these disclosures are lower in countries with more sophisticated users and more stringent regulations and enforcement. This is robust to the consideration of the level of impression management surrounding information other than non-GAAP earnings
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