Does Silence Speak? An Empirical Analysis of Disclosure Choices during Conference Calls

Journal of Accounting Research, Vol. 48, No. 3, pp. 531-563

50 Pages Posted: 8 Sep 2008 Last revised: 2 Dec 2010

See all articles by Stephan Hollander

Stephan Hollander

Tilburg University - Tilburg School of Economics and Management

Maarten Pronk

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Erik Roelofsen

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM)

Date Written: January 4, 2010

Abstract

In this paper, we exploit the open nature of conference calls to explore whether managers withhold information from the investing public. Our evidence suggests that managers regularly leave participants on the conference call in the dark by not answering their questions. We find that the best predictors of such an event are firm size, a CEO’s stock price–based incentives, company age, firm performance, litigation risk, and whether analysts are actively involved during the call’s Q&A section. Finally, we document strong support for the assumption maintained in the literature that investors interpret silence negatively. That is, investors seem to interpret no news as bad news.

Keywords: Discretionary disclosure, conference calls, incomplete disclosure, silence

JEL Classification: D21, J33, M41

Suggested Citation

Hollander, Stephan and Pronk, Maarten and Roelofsen, Erik, Does Silence Speak? An Empirical Analysis of Disclosure Choices during Conference Calls (January 4, 2010). Journal of Accounting Research, Vol. 48, No. 3, pp. 531-563, Available at SSRN: https://ssrn.com/abstract=1264966 or http://dx.doi.org/10.2139/ssrn.1264966

Stephan Hollander (Contact Author)

Tilburg University - Tilburg School of Economics and Management ( email )

P.O. Box 90153
Tilburg, DC Noord-Brabant 5000 LE
Netherlands
+31 13 466 8288 (Phone)
+31 13 466 8001 (Fax)

HOME PAGE: http://www.uvt.nl/people/s.hollander

Maarten Pronk

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands

Erik Roelofsen

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands

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