SEC enforcement: Does forthright disclosure and cooperation really matter?

• 成果类型: Article
• 署名作者: Files, Rebecca
• 署名单位: University of Texas System; University of Texas Dallas
• 刊物名称: JOURNAL OF ACCOUNTING & ECONOMICS
• ISSN/ISSBN: 0165-4101
• DOI: 10.1016/j.jacceco.2011.06.006
• 发表日期: 2012
• 关键词: Equity incentives; MARKET; CONSEQUENCES; RESTATEMENTS; determinants; earnings; returns; FRAUD; FIRMS

摘要

This study examines the conditions under which the Securities and Exchange Commission (SEC) exercises enforcement leniency following a restatement. I explore whether cooperation with SEC staff and forthright disclosure of a restatement (e.g., disclosures reported in a timely and visible manner) reduce the likelihood of an SEC sanction or SEC monetary penalties. After controlling for restatement severity, I find that cooperation increases the likelihood of being sanctioned, perhaps because it improves the SEC's ability to build a successful case against the firm. However, cooperation and forthright disclosures are rewarded by the SEC through lower monetary penalties. (C) 2011 Elsevier B.V. All rights reserved.