Investor Sentiment and Pro Forma Earnings Disclosures

• 成果类型: Article
• 署名作者: Brown, Nerissa C.; Christensen, Theodore E.; Elliott, W. Brooke; Mergenthaler, Richard D.
• 署名单位: University System of Georgia; Georgia State University; Brigham Young University; University of Illinois System; University of Illinois Urbana-Champaign; University of Iowa
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/j.1475-679X.2011.00427.x
• 发表日期: 2012
• 页码: 1-40
• 关键词: stock-prices; GAAP; MARKET; Informativeness; emphasis; analysts; STREET; logit

摘要

We examine the influence of investor sentiment on managers discretionary disclosure of pro forma (adjusted) earnings metrics in earnings press releases. We find that managers propensity to disclose an adjusted earnings metric (especially one that exceeds the GAAP earnings number) increases with the level of investor sentiment. Furthermore, our analyses suggest that, as investor sentiment increases, managers: (1) exclude higher levels of both recurring and nonrecurring expenses in calculating the pro forma earnings number and (2) emphasize the pro forma figure by placing it more prominently within the earnings press release. Additional analyses indicate that the association between investor sentiment and managers pro forma disclosure decisions at least partly reflects opportunistic motives. Finally, we find that managers own sentiment-driven expectations also play a role in their pro forma disclosure decisions.