|
Post by Sapphire Capital on Aug 23, 2008 2:39:27 GMT 4
The Impact of the SEC's Regulation of Non-GAAP Disclosures Frank Heflin Florida State University - College of Business Charles Hsu Hong Kong University of Science & Technology Journal of Accounting & Economics (JAE), Forthcoming Abstract: Rules implemented by the U.S. Securities and Exchange Commission in 2003 impose additional disclosure and filing requirements on firms publicly disclosing non-GAAP earnings. We find the regulations produced (1) modest declines in the frequency of special- and other-item exclusions, (2) a decline in exclusion magnitude, (3) a modest decline in the probability disclosed earnings meet or beat forecasts, and (4) a decline in the association between returns and forecast errors. Our results suggest that, while the regulations reduced firms' use of non-GAAP disclosures to improve performance perceptions, they also reduced firms' willingness to use non-GAAP earnings to convey permanent earnings. papers.ssrn.com/sol3/papers.cfm?abstract_id=1182636
|
|