Firm performance, reporting goals, and language choices in narrative disclosures

• 成果类型: Article
• 署名作者: Asay, H. Scott; Libby, Robert; Rennekamp, Kristina
• 署名单位: University of Iowa; Cornell University
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2018.02.002
• 发表日期: 2018
• 关键词: ANNUAL-REPORT READABILITY; Financial disclosure; Earnings persistence; plain english; complexity; investors; INFORMATION; creativity; judgments; IMPACT

摘要

We use an experiment with experienced managers to provide more-direct evidence on how reporting goals and firm performance influence language choices. We find that bad news disclosures are less readable than good news, but only when managers have a stronger self-enhancement motive. Our results suggest that this difference is driven mainly by attempts to write more readable good news reports as opposed to intentional obfuscation of poor performance. In order to frame poor performance in a positive light, managers also focus more on the future, provide causal explanations for poor performance, and use more passive voice and fewer personal pronouns.