The Determinants and Consequences of Information Acquisition via <scp>EDGAR</scp>

Drake, Michael S.; Roulstone, Darren T.; Thornock, Jacob R.

doi:10.1111/1911-3846.12119

Cited by 302 publications

(139 citation statements)

References 55 publications

(57 reference statements)

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“…These public data have been provided by the SEC and similar data have been employed in other studies (e.g., Drake, Roulstone, and Thornock [], Lee, Ma, and Wang []).…”

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confidence: 99%

“…10‐Ks are by far the most downloaded report by the IRS in our sample—the IRS downloads twice as many 10‐Ks as 8‐Ks and nine times as many 10‐Ks as 10‐Qs (even though there are roughly three times as many 10‐Qs available to download). Drake, Roulstone, and Thornock [] find that 10‐Ks are the most demanded SEC filing by EDGAR users. The IRS downloads many types of filings beyond these four, including, for example, SEC comment letters, which may be useful in the tax enforcement process (Kubick et al.…”

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confidence: 99%

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IRS Attention

Bozanic

Hoopes

Thornock

et al. 2016

Journal of Accounting Research

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231

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We study how public and private disclosure requirements interact to influence both tax regulator enforcement and firm disclosure. To capture IRS enforcement activities, we introduce a novel data set of IRS acquisition of firms' public financial disclosures, which we label IRS attention. We examine the implementation of two new disclosure requirements that potentially alter IRS attention: FIN 48, which increased public tax disclosure requirements, * The Ohio State University; † University of North Carolina at Chapel Hill; ‡ Brigham Young University; § University of Texas at Austin.Accepted by Douglas Skinner. We are grateful for the insightful suggestions received from an anonymous reviewer. We also appreciate comments from Sam Anderson, Darren Bernard, Terrence Blackburne, Amoray Cragun, Mike Drake, Scott Dyreng, Alex Edwards (ATA discussant), Merle Erickson, Paul Fischer, Pete Frischmann, Kevin Holland (Oxford discussant), Mike Iselin, Colin Koutney, Ed Maydew, Rick Mergenthaler, Lillian Mills, Michelle Nessa (Midwest Conference Discussant), Phil Quinn, Darren Roulstone, Jeri Seidman, Terry Shevlin, Lorien Stice-Lawrence, Erin Towery (FARS discussant), and Jaron Wilde; workshop participants at the University of Chicago, the University of North Carolina, the University of Minnesota, and the University of Texas at Austin; and participants at the 2014 BYU Accounting Symposium, the 2015 AAA FARS Midyear Meeting, the 2015 ATA Midyear Meeting, the 2015 Midwest Summer Research Conference, and the 2016 Oxford Academic Symposium. We are grateful for data assistance from SECLive.com and, in particular, from Slavi Marinov. Thornock is affiliated with SECLive.com as an academic advisor. We gratefully acknowledge financial support from the Fisher College of Business, the Foster School of Business, the Kenan-Flagler Business School, the Marriott School of Management, and the McCombs School of Business. Neither the IRS nor the SEC have provided any of the authors with privileged data for this paper or have reviewed the paper. This work is solely the responsibility of the authors. An online appendix to this paper can be downloaded at http://research.chicagobooth.edu/ arc/journal-of-accounting-research/online-supplements. The IRS attention data are available at http://www.jeffreyhoopes.com/data/irsattentiondata.html. and Schedule UTP, which increased private tax disclosure. We find that IRS attention increased following FIN 48 but subsequently decreased following Schedule UTP, consistent with public and private disclosure interacting to influence tax enforcement. We next examine how private tax disclosure requirements under Schedule UTP affected firms' public disclosure responses. We find that, following Schedule UTP, firms significantly increased the quantity and altered the content of their tax-related disclosures, consistent with lower tax-related proprietary costs of disclosure. Our results suggest that changes in SEC disclosure requirements altered the IRS's behavior with regard to public information acquisition, a...

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“…These public data have been provided by the SEC and similar data have been employed in other studies (e.g., Drake, Roulstone, and Thornock [], Lee, Ma, and Wang []).…”

mentioning

confidence: 99%

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confidence: 99%

IRS Attention

Bozanic

Hoopes

Thornock

et al. 2016

Journal of Accounting Research

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231

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“…In addition, our study adds to the growing body of accounting research on nonprofessional investor decision making. Archival research shows that investor information search, on an aggregate level (i.e., volume of search), is associated with specific characteristics of the firm, including corporate events and the strength of the information environment (Drake et al, 2014). Prior experimental and survey research identifies individual characteristics influencing investors' information search, such as investor affect (Blay et al, 2012) and experience (Hodge and Pronk, 2006;Elliott et al, 2008).…”

Section: Stopping Rule Descriptionmentioning

confidence: 99%

“…For example, archival research provides evidence that investors use Google searches (Drake et al, 2012), Twitter (Blankespoor et al, 2013), EDGAR (Drake et al, 2014), Wikipedia (Xu and Zhang, 2013), and financial blogs (Saxton and Anker, 2013) to access investment-related information. As compared to a paper-based environment, online information search is characterized by a seemingly endless amount of available information.…”

Section: Information Search and Cognitive Stopping Rulesmentioning

confidence: 99%

“…For example, archival studies offer evidence of aggregate investor information search volume via EDGAR and Google around corporate event dates (e.g., Drake et al, 2012Drake et al, , 2014, but archival methods cannot identify individual decision processes or investor characteristics that influence search. The most common survey method is to provide investors lists of information types and sources to evaluate (e.g., Elliott et al, 2008), and experimental studies (e.g., Cianci and Falsetta, 2008;Rose et al, 2010;Arnold et al, 2011) vary specific information cues presented to participants in order to isolate variables of interest that impact search.…”

Section: Introductionmentioning

confidence: 99%

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How much is enough? An investigation of nonprofessional investors information search and stopping rule use

Pennington

Kelton

2016

International Journal of Accounting Information Systems

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Signaling revisited: The use of signals in the market for IPOs

Park

Borah

Kotha

2016

Strategic Management Journal

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Research summary: Scholars have actively researched the initial public offering (IPO) underpricing phenomenon as it relates to the issuing firm's resource acquisition and entrepreneur's wealth retention. In this study, we attempt to replicate three studies that examine how top management and board‐level characteristics impact IPO underpricing using signaling theory. Focusing on a different time period and using a new sample of 234 U.S. IPO firms, we do not find evidence for the signaling effects of top management, governance structure, and social ties on resource acquisition and wealth retention during the IPO process. We propose possible theoretical and empirical reasons for our results and discuss two major external changes that researchers should account in future research. Managerial summary: Past studies on initial public offering (IPO) underpricing have systematically documented the effectiveness of signals (i.e., having seasoned CEO and top management team, director independence, and director network) that influence the amount of money entrepreneurs “leave on the table” during the IPO process. Since these studies were conducted before the ongoing information revolution, we re‐examined the effectiveness of these signals in the current IPO market. Despite using similar methodological approaches that past studies used, we do not find evidence supporting the prior findings. To explain our findings, we discuss two notable recent changes—unprecedented access to information and a regulatory change—that future researchers should examine in the context of IPO underpricing research. Copyright © 2016 John Wiley & Sons, Ltd

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The Determinants and Consequences of Information Acquisition via EDGAR

Cited by 302 publications

References 55 publications

IRS Attention

IRS Attention

How much is enough? An investigation of nonprofessional investors information search and stopping rule use

Signaling revisited: The use of signals in the market for IPOs

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