The capital market implications of the frequency of interim financial reporting: an international analysis

The capital market implications of the frequency of interim financial reporting: an international... This study examines empirically the extent to which the frequency of interim financial reporting affects stock price volatility over the course of the fiscal year in four countries with different interim reporting regimes: the United States and Canada with quarterly reporting, and Great Britain and Australia with semi-annual interim reporting. It is hypothesized that, in the tradeoff between timeliness and predictive value of the interim reports, semi-annual interim reporting will lead to lesser price volatility after accounting for other potential influences. These expectations are supported in the results found. Moreover, additional tests conducted on American ADRs of British and Australian companies show that those firms have higher volatility than comparable purely domestic firms on their home stock exchanges. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of Quantitative Finance and Accounting Springer Journals

The capital market implications of the frequency of interim financial reporting: an international analysis

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Publisher
Springer US
Copyright
Copyright © 2007 by Springer Science+Business Media, LLC
Subject
Finance; Corporate Finance; Accounting/Auditing; Econometrics; Operation Research/Decision Theory
ISSN
0924-865X
eISSN
1573-7179
D.O.I.
10.1007/s11156-007-0069-0
Publisher site
See Article on Publisher Site

Abstract

This study examines empirically the extent to which the frequency of interim financial reporting affects stock price volatility over the course of the fiscal year in four countries with different interim reporting regimes: the United States and Canada with quarterly reporting, and Great Britain and Australia with semi-annual interim reporting. It is hypothesized that, in the tradeoff between timeliness and predictive value of the interim reports, semi-annual interim reporting will lead to lesser price volatility after accounting for other potential influences. These expectations are supported in the results found. Moreover, additional tests conducted on American ADRs of British and Australian companies show that those firms have higher volatility than comparable purely domestic firms on their home stock exchanges.

Journal

Review of Quantitative Finance and AccountingSpringer Journals

Published: Oct 2, 2007

References

  • Risks for the long-run: a potential resolution of asset pricing puzzles
    Bansal, R; Yaron, A
  • Empirical analysis of stock returns and volatility: evidence from Seven Asian stock markets based on TAR-GARCH model
    Chiang, TC; Doong, S-C
  • Does greater firm-specific return variation mean more or less informed stock pricing?
    Durnev, A; Morck, R; Yeung, B; Zarowin, P
  • Firm prominence and the differential information content of quarterly earnings announcements
    Kross, W; Schroeder, D

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