Is silence golden sometimes? Management guidance withdrawals during the COVID-19 pandemic

• 成果类型: Article
• 署名作者: Hope, Ole-Kristian; Li, Congcong; Ma, Mark Shuai; Su, Xijiang
• 署名单位: University of Toronto; BI Norwegian Business School; Duquesne University; Pennsylvania Commonwealth System of Higher Education (PCSHE); University of Pittsburgh
• 刊物名称: REVIEW OF ACCOUNTING STUDIES
• ISSN/ISSBN: 1380-6653
• DOI: 10.1007/s11142-022-09698-w
• 发表日期: 2023
• 页码: 2319-2360
• 关键词: EARNINGS FORECASTS; discretionary disclosure; information asymmetry; voluntary disclosure; empirical-analysis; trading volume; POLICY; FIRMS; uncertainty; LITIGATION

摘要

The many management guidance withdrawals during the COVID-19 pandemic have attracted considerable attention from the media, investors, and regulators. This study analyzes the determinants and consequences of these withdrawals. We find that guidance withdrawals are due to economic uncertainty, resulting from firms' exposure to the COVID-19 pandemic rather than poor financial performance. Also, the effect of COVID-19 exposure on guidance withdrawals is stronger when firms face higher litigation risk. Further, guidance withdrawals result in abnormally large trading volumes and high analyst forecast dispersion but do not harm stock prices or the level of analyst earnings forecasts. Overall we believe the findings have implications for understanding corporate disclosure practices during periods with heightened economic uncertainty.