An Investigation of the Effectiveness of the Division of Corporate Finance as a Monitor of Financial Reporting

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dc.contributor.authorEdmonds, Jennifer Echolsen
dc.contributor.committeechairCloyd, C. Bryanen
dc.contributor.committeememberBrown, Robert M.en
dc.contributor.committeememberHansen, Thomas Boween
dc.contributor.committeememberMaher, John J.en
dc.contributor.committeememberMansi, Sattar A.en
dc.contributor.departmentAccounting and Information Systemsen
dc.date.accessioned2014-03-14T21:23:30Zen
dc.date.adate2012-01-18en
dc.date.available2014-03-14T21:23:30Zen
dc.date.issued2011-12-14en
dc.date.rdate2012-01-18en
dc.date.sdate2011-12-21en
dc.description.abstractThis study uses the Securities and Exchange Commission's (SEC) comment letters to investigate the SEC's role as a monitor of financial reporting. I examine whether the SEC effectively comments on firms with poor disclosure quality. I utilize forward earnings response coefficients (FERC) as a measure of the market's perception of disclosure quality. I expect comment letter firms to have lower disclosure quality and thus lower FERCs. Secondly, within the firms selected for comment, I investigate whether the Division allocates a greater amount of resources towards firms with more severe disclosure deficiencies. Results indicate that comment letter recipients have significantly lower forward earnings response coefficients than non- recipients. Results also document that comment letter recipients have lower contemporaneous earnings response coefficients than non-recipients. These findings are consistent with the DCF being effective in selecting firms that are perceived by the market as having low disclosure and earnings quality. However, within comment letter firms, I am unable to provide any evidence that the DCF allocates more resources to firms with lower forward earnings response coefficients.en
dc.description.degreePh. D.en
dc.identifier.otheretd-12212011-170804en
dc.identifier.sourceurlhttp://scholar.lib.vt.edu/theses/available/etd-12212011-170804/en
dc.identifier.urihttp://hdl.handle.net/10919/40437en
dc.publisherVirginia Techen
dc.relation.haspartEdmonds_JE_D_2011.pdfen
dc.rightsIn Copyrighten
dc.rights.urihttp://rightsstatements.org/vocab/InC/1.0/en
dc.subjectDisclosure Qualityen
dc.subjectForward Earnings Response Coefficienten
dc.subjectComment Lettersen
dc.titleAn Investigation of the Effectiveness of the Division of Corporate Finance as a Monitor of Financial Reportingen
dc.typeDissertationen
thesis.degree.disciplineAccounting and Information Systemsen
thesis.degree.grantorVirginia Polytechnic Institute and State Universityen
thesis.degree.leveldoctoralen
thesis.degree.namePh. D.en

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