Restatement Announcements: Sincerity Analysis Through Information Manipulation Theory
29 Pages Posted: 19 Jan 2012 Last revised: 29 Aug 2017
Date Written: January 15, 2016
This study explore whether publicly held companies manipulate the restatement announcement arising from material errors and/or fraud. It analyzes the information provided in the press and in the 8-Ks (8K_PR) by applying Information Manipulation Theory. Results indicate that companies manipulating the quality and the timing of information released in the 8K_PR related to restatement are more likely to mislead investors. Precisely, we find that companies disclosing inaccurate information in the 8K_PR and delaying releasing the restated earnings are more likely to occur among fraudulent companies.
Keywords: Restatement Announcement, Press Release, Form 8-K, Deception, Information Manipulation Theory
JEL Classification: M41
Suggested Citation: Suggested Citation