Artigo em revista científica Q1
Institutional Investors’ Reaction to SEC Concerns about IFRS and US GAAP Reporting
Miles Gietzmann (Gietzmann, M.); Helena Isidro (Isidro, H.);
Título Revista
Journal of Business Finance and Accounting
Ano
2013
Língua
Inglês
País
Reino Unido
Mais Informação
Web of Science®

N.º de citações: 8

(Última verificação: 2019-09-18 05:08)

Ver o registo na Web of Science®

Scopus

N.º de citações: 8

(Última verificação: 2019-09-19 04:30)

Ver o registo na Scopus

Abstract/Resumo
For the period of 2006 to 2008, we collect Comment Letters issued by the SEC that question the application of US GAAP by US firms or the application of IFRS by European firms registered with the SEC. We investigate whether institutional investors react to the letters by changing their holdings and whether their responses vary for US registrants and European registrants. We do this via a treatment-effects model in which we test the hypothesis that institutional investors rebalance their portfolio holdings because they view Comment Letters as informative public signals. We find that institutional investors reduce their equity holdings when firms receive SEC Comment Letters, and their negative reactions are most marked for low turnover institutional investors, who we use to represent those informed investors most prepared to incur costs to closely monitor firms. Next, while noting that the number of Letters questioning application of IFRS are smaller in number relative to those questioning application of US GAAP, we investigate whether there are different reactions to Comment Letters questioning different standards. We show that there is a higher probability of the SEC questioning the application of IFRS as compared to US GAAP. After controlling for firm-specific conditions that impact the issuance of a Comment Letter, we show that this higher probability has economic significance because institutional investors’ react more negatively to Comment Letters that question the application of IFRS as compared to US GAAP. A content analysis confirms the economic importance of the Comment Letters. We find that in almost half of all IFRS cases the Comment Letters request amendments to financial statements.
Agradecimentos/Acknowledgements
--
Palavras-chave
SEC regulation, International Financial Reporting Standards (IFRS), Comment letters, Financial reporting quality; Institutional investors
  • Economia e Gestão - Ciências Sociais

Com o objetivo de aumentar a investigação direcionada para o cumprimento dos Objetivos do Desenvolvimento Sustentável para 2030 das Nações Unidas, é disponibilizada no Ciência-IUL a possibilidade de associação, quando aplicável, dos artigos científicos aos Objetivos do Desenvolvimento Sustentável. Estes são os Objetivos do Desenvolvimento Sustentável identificados pelo(s) autor(es) para esta publicação. Para uma informação detalhada dos Objetivos do Desenvolvimento Sustentável, clique aqui.