How plain English use affects the length of annual reports: Evidence from the annual reports of foreign firms listed on the US stock exchange

Nguyen, Phuong; Kimura, Arata

doi:10.1016/j.jaccpubpol.2020.106773

Cited by 8 publications

(8 citation statements)

References 39 publications

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“…The results in Models 1-4 show that minority shareholder activism improves the timeliness of annual reports, leads the annual reports to be longer with more characters and increased vocabulary, but the sentences in the annual reports are shorter, respectively. Previous research proposes that investors can acquire more available information when the corporate releases are long but the sentences are short (Li, 2008;Nguyen and Kimura, 2020). Thus, we can deduce that minority shareholder activism can improve the information content of corporate annual reports.…”

Section: Impact On Annual Reportsmentioning

confidence: 89%

The power of crowds: can minority shareholder activism promote management earnings forecast accuracy

Nie

2021

Accounting & Finance

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Novel online activism of minority shareholders could be a new governance mechanism but has received little academic attention. This study examines the impact of such minority shareholder activism on management earnings forecast accuracy. Based on a sample of publicly listed firms in the Chinese Shenzhen Stock Exchange between 2010 and 2018, we find that online activism promotes earnings forecast accuracy. The effect is stronger with more negative media coverage and higher manager response quality. Overall, our results indicate that minority shareholders in China could play a monitoring role when they are empowered with voice in the information age.

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Section: Impact On Annual Reportsmentioning

confidence: 89%

The power of crowds: can minority shareholder activism promote management earnings forecast accuracy

Nie

2021

Accounting & Finance

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“…With specific respect to content complexity, prior accounting research (Ebdon 2002; Jones et al 1985; Kuang et al 2020; Nguyen & Kimura 2020; Smith & Taffler 1992; Stevens et al 1983) underlined that the sophistication of accounting language makes accounting information incomprehensible for the majority of users. The psychology literature similarly suggested that understanding is facilitated when readers are familiar with the language used in a given document.…”

Section: Literature Review and Hypotheses Developmentmentioning

confidence: 99%

Financial reporting transparency, citizens' understanding, and public participation: A survey experiment study

Langella¹,

Pessina²,

Redmayne

et al. 2021

Public Administration

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“…Compared to smaller firms, the disclosure of larger firms has more information content because of their more complex transactions (Cazier and Pfeiffer, 2016;Li, 2008;Nguyen and Kimura, 2020), increasing demand for timely information for large firms.…”

Section: Jaee 142mentioning

confidence: 99%

“…Proper regulation of the content and timing of corporate disclosures is arguably crucial for well-functioning capital markets. Mandating more disclosure which is less relevant for making decisions would inevitably increase time and cost for businesses when they prepare the reports and for investors when they process the information (Nguyen and Kimura, 2020). The Thai regulators argue that "Form 56-1 One Report" initiative, which combines Form 56-1 and Form 56-2 as "Form 56-1 One Report" and shortens the filing deadline of "Form 56-1 One Report" to within three months after the fiscal year-end (SEC Thailand, 2019b), will mitigate compliance costs for firms and enhance decisions for investors by improving the information and timeliness of mandatory disclosures.…”

Section: Introductionmentioning

confidence: 99%

Market reactions to timing and information of mandatory disclosures

Kiattikulwattana¹,

Pattanapanyasat²

2023

JAEE

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PurposeThis study examines whether investors value the timing and/or information of mandatory disclosures in a unique research setting of listed companies in Thailand.Design/methodology/approachThe authors adopt an event-study based approach. Abnormal stock returns are calculated using an OLS market model to measure market reactions to three types of mandatory reports issued by listed Thai firms: financial statements, Form 56-1 and Form 56-2. These reports are released sequentially but contain overlapping information content. Multivariate regression models are employed to examine the market reactions to these regulatory reports and explore the characteristics of firms that affect the market response.FindingsThe stock market reacts differentially to these reports. The financial statements, which are filed the earliest and are the most concise, prompt the strongest reaction. Investors similarly react significantly to Form 56-1 and Form 56-2, although Form 56-2 provides additional information beyond Form 56-1. The market reactions to small firms are stronger. Collectively, equity investors focus on the timeliness of disclosures rather than the information disclosed in the mandatory reports.Practical implicationsThe evidence provides support for ongoing regulatory initiatives aimed at improving the timeliness of mandatory disclosures in emerging economies.Originality/valuePrior studies on disclosure regulation investigate either the effect of information content or the timing of mandatory disclosures in isolation. The authors differentiate the effect of information content from disclosure timing and extend the literature by suggesting that investors incrementally value timeliness of disclosures. Investors perceive the benefit of the timely release of quantitative information compared to subsequent narrative disclosures. Between Form 56-1 and Form 56-2, the earlier release of the narrative non-financial information is incrementally traded into share prices.

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How plain English use affects the length of annual reports: Evidence from the annual reports of foreign firms listed on the US stock exchange

Cited by 8 publications

References 39 publications

The power of crowds: can minority shareholder activism promote management earnings forecast accuracy

The power of crowds: can minority shareholder activism promote management earnings forecast accuracy

Financial reporting transparency, citizens' understanding, and public participation: A survey experiment study

Market reactions to timing and information of mandatory disclosures

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