The Role of Sales Executives in Voluntary Disclosures

Posted: 15 Jan 2016 Last revised: 22 Jun 2016

See all articles by Kai Wai Hui

Kai Wai Hui

The University of Hong Kong (HKU) - Department of Accounting

Wei Shi

Deakin University

Date Written: December 1, 2015

Abstract

This study examines the importance of sales executives in firms’ disclosure policies. Our findings show that the fixed effects of sales executives are significant in explaining the properties of both revenue-related financial and non-financial disclosures after we control for economic determinants and the effects of CEOs and CFOs. We also find that sales executives are more important than those of CEOs and CFOs in deciding revenue forecasts, and when firms have higher prosperity costs and operating complexity. Our evidence is consistent when exogenous executive turnovers are applied in the test. Finally, our findings are robust after we control for the endogeneity of whether firms’ sales executives are in top-five management teams. In summary, our study contributes to the literature by documenting sales executives as an important determinant of disclosure decisions.

Keywords: sales executives, individual-specific styles, earnings and revenue forecasts, non-financial disclosures

JEL Classification: M31, D81, G14, M41

Suggested Citation

Hui, Kai Wai and Shi, Wei, The Role of Sales Executives in Voluntary Disclosures (December 1, 2015). Available at SSRN: https://ssrn.com/abstract=2715402 or http://dx.doi.org/10.2139/ssrn.2715402

Kai Wai Hui (Contact Author)

The University of Hong Kong (HKU) - Department of Accounting ( email )

Pokfulam Road
Hong Kong, Pokfulam
Hong Kong

Wei Shi

Deakin University ( email )

Burwood 3125, VIC
Melbourne, 3125
Australia
0404383819 (Phone)

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