Corporate Investments: Learning from Restatements

• 成果类型: Review
• 署名作者: Durnev, Art; Mangen, Claudine
• 署名单位: McGill University; Concordia University - Canada
• 刊物名称: JOURNAL OF ACCOUNTING RESEARCH
• ISSN/ISSBN: 0021-8456
• DOI: 10.1111/j.1475-679X.2009.00332.x
• 发表日期: 2009
• 页码: 679-720
• 关键词: pro forma earnings; sfas no. 131; accounting restatements; executive-compensation; voluntary disclosures; information-content; MARKET REACTIONS; control-systems; stock returns; AGENCY COSTS

摘要

This study analyzes the information conveyed by the restatements of financial reports. We argue that restatements contain news about the investment projects of the restating firms' competitors. This news causes competitors to revise their beliefs about the projects' value, and to modify their subsequent investment decisions. Accordingly, we hypothesize that changes in competitors' investments after restatement announcements are related to news in the restatements. Consistent with our prediction, we find that changes in competitors' investments following restatement announcements are significantly related to various proxies for news in the restatements, such as competitors' and restating firms' abnormal returns at the restatement announcements. We conclude that restatements convey information about the investment projects of restating firms' competitors.