Discussion - Regulation Fair Disclosure and Analysts' First-Forecast Horizon

5 Pages Posted: 28 Mar 2008

See all articles by Lawrence D. Brown

Lawrence D. Brown

Temple University - Department of Accounting

Date Written: 2007

Abstract

Surya Janakiraman, Suresh Radhakrishnan, and Rafal Szwejkowski (2007), hereafter JRS, examine the impact of regulation fair disclosure (RFD) on the number of days between analysts' first earnings forecasts for the quarter and the fiscal quarter-end (first-forecast horizon). JRS conclude that the first-forecast horizon decreased by twelve days post-RFD; it decreased for both analysts whose average annual first-forecast horizon put them in the top 25 percent for each firm (designated by JRS as leaders) and the bottom 25 percent for each firm (designated by JRS as followers); and it decreased about the same amount for both leaders and followers. JRS interpret their results as follows. RFD reduced the first-forecast horizon on average overall; it reduced the first-forecast horizon for both leaders and followers; and it did not eliminate the timing advantage of leaders versus followers. My discussion proceeds along the following lines. First, I examine whether RFD reduced the first-forecast horizon. Second, I examine whether RFD decreased the first-forecast horizon for both leaders and followers. Third, I examine whether RFD decreased the first-forecast horizon for leaders versus followers.

JEL Classification: M41, M45, G38, G29

Suggested Citation

Brown, Lawrence D., Discussion - Regulation Fair Disclosure and Analysts' First-Forecast Horizon (2007). Journal of Accounting, Auditing and Finance, Vol. 22, No. 2, 2007. Available at SSRN: https://ssrn.com/abstract=1113404

Lawrence D. Brown (Contact Author)

Temple University - Department of Accounting ( email )

Philadelphia, PA 19122
United States

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