Non-answers during Conference Calls

92 Pages Posted: 4 Jan 2019 Last revised: 6 May 2021

See all articles by Ian D. Gow

Ian D. Gow

University of Melbourne; University of Melbourne - Department of Accounting and Business Information Systems

David F. Larcker

Stanford University - Graduate School of Business; European Corporate Governance Institute (ECGI); Stanford University - Arthur & Toni Rembe Rock Center for Corporate Governance

Anastasia A. Zakolyukina

University of Chicago - Booth School of Business

Date Written: May 5, 2021

Abstract

We construct a novel measure of disclosure choice by firms. Our measure is computed using linguistic analysis of conference calls to identify whether a manager’s response to an analyst question is a “non-answer.” Using our measure, about 11% of analyst questions elicit non-answers from managers, a rate that is stable over time and similar across industries. A useful feature of our measure is that it enables an examination of disclosure choice within a call. Analyst questions with a negative tone, greater uncertainty, greater complexity, or requests for greater detail are more likely to trigger non-answers. We find performance-related questions tend to be associated with non-answers, and this association is weaker when performance news is favorable. We also find analyst questions about proprietary information are associated with non-answers, and this association is stronger when firm competition is more intense.

Keywords: Voluntary disclosure, asymmetric information, conference calls, textual analysis

JEL Classification: D82, D83, G14, M41

Suggested Citation

Gow, Ian D. and Larcker, David F. and Zakolyukina, Anastasia A., Non-answers during Conference Calls (May 5, 2021). Journal of Accounting Research, forthcoming, Chicago Booth Research Paper No. 19-01, Fama-Miller Working Paper , Rock Center for Corporate Governance at Stanford University Working Paper No. 237, Available at SSRN: https://ssrn.com/abstract=3310360 or http://dx.doi.org/10.2139/ssrn.3310360

Ian D. Gow

University of Melbourne ( email )

185 Pelham Street
Carlton, Victoria 3053
Australia

University of Melbourne - Department of Accounting and Business Information Systems ( email )

Victoria
Melbourne, Victoria 3010 3010
Australia

David F. Larcker

Stanford University - Graduate School of Business ( email )

Graduate School of Business
518 Memorial Way
Stanford, CA 94305-5015
United States
650-725-6159 (Phone)

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Stanford University - Arthur & Toni Rembe Rock Center for Corporate Governance ( email )

Crown Quadrangle 559 Nathan Ab
Stanford, CA 94305-8610
United States

Anastasia A. Zakolyukina (Contact Author)

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States
773.834.4838 (Phone)
773.926.0941 (Fax)

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