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The Association between Corporate Boards, Audit Committees, and Management Earnings Forecasts: An Empirical Analysis

The Association between Corporate Boards, Audit Committees, and Management Earnings Forecasts: An... ABSTRACT We study how corporate boards and audit committees are associated with voluntary financial disclosure practices, proxied here by management earnings forecasts. We find that in firms with more effective board and audit committee structures, managers are more likely to make or update an earnings forecast, and their forecast is less likely to be precise, it is more accurate, and it elicits a more favorable market response. Together, our empirical evidence is broadly consistent with the notion that effective corporate governance is associated with higher financial disclosure quality. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Accounting Research Wiley

The Association between Corporate Boards, Audit Committees, and Management Earnings Forecasts: An Empirical Analysis

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References (84)

Publisher
Wiley
Copyright
Copyright © 2005 Wiley Subscription Services, Inc., A Wiley Company
ISSN
0021-8456
eISSN
1475-679X
DOI
10.1111/j.1475-679X.2005.00177.x
Publisher site
See Article on Publisher Site

Abstract

ABSTRACT We study how corporate boards and audit committees are associated with voluntary financial disclosure practices, proxied here by management earnings forecasts. We find that in firms with more effective board and audit committee structures, managers are more likely to make or update an earnings forecast, and their forecast is less likely to be precise, it is more accurate, and it elicits a more favorable market response. Together, our empirical evidence is broadly consistent with the notion that effective corporate governance is associated with higher financial disclosure quality.

Journal

Journal of Accounting ResearchWiley

Published: Jun 1, 2005

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