Measuring Disclosure Using 8K Filings

75 Pages Posted: 8 Aug 2015 Last revised: 15 Feb 2018

Michael J. Cooper

University of Utah - David Eccles School of Business

Jing He

University of Utah - School of Accounting and Information Systems

Marlene Plumlee

University of Utah - School of Accounting

Date Written: February 2018

Abstract

We construct and validate four comprehensive firm-specific voluntary disclosure measures using information reported via 8-Ks. One is the count of 8-Ks, and the other three are based on information drawn from voluntary 8-K-item numbers (2.02, 7.01, and 8.01). The second and third measures are based on the count and the word count of the items and exhibits within the voluntary 8-K items. The final measure is the number of times a firm reports the disclosure of management guidance, conference calls, non-GAAP measures, and investor days within the voluntary 8-K items. We validate our measures by examining (1) theoretical associations between them and two proxies for information asymmetry and the cost of equity and (2) the determinants. We also calculate two measures of concurrent firm-specific mandatory disclosure to act as controls. Overall, we present evidence that our new measures behave consistent with the underlying construct, based on our validation tests.

Keywords: voluntary disclosure; mandatory disclosure, 8-K filings

JEL Classification: M41; D83

Suggested Citation

Cooper, Michael J. and He, Jing and Plumlee, Marlene A., Measuring Disclosure Using 8K Filings (February 2018). Available at SSRN: https://ssrn.com/abstract=2640722 or http://dx.doi.org/10.2139/ssrn.2640722

Michael J. Cooper

University of Utah - David Eccles School of Business ( email )

1645 E Campus Center Dr
Salt Lake City, UT 84112-9303
United States

Jing He

University of Utah - School of Accounting and Information Systems ( email )

1645 Campus Center Drive
Salt Lake City, UT 84112
United States

Marlene A. Plumlee (Contact Author)

University of Utah - School of Accounting ( email )

1645 E Campus Center Dr
Salt Lake City, UT 84112-9303
United States

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