Accelerated Filing Deadlines, Internal Controls, and Financial Statement Quality: The Case of Originating Misstatements

Colleen M. Boland, Scott N. Bronson, and Chris E. Hogan (2015) Accelerated Filing Deadlines, Internal Controls, and Financial Statement Quality: The Case of Originating Misstatements. Accounting Horizons: September 2015, Vol. 29, No. 3, pp. 551-575.

Posted: 8 Aug 2019

See all articles by Colleen M. Boland

Colleen M. Boland

University of Wisconsin - Milwaukee - Sheldon B. Lubar School of Business

Chris E. Hogan

Michigan State University - Department of Accounting & Information Systems

Scott N. Bronson

School of Business - University of Kansas

Date Written: August 5, 2013

Abstract

We examine whether regulations requiring accelerated filing deadlines and internal control reporting and testing affect financial statement reliability. Unlike prior research, we examine whether these regulatory changes are associated with an increase in the likelihood that misstatements originate in the period following the respective change. If the implementation of these rules causes a misstatement, then the misstatement would most likely occur in the period immediately following the rule change. We provide evidence that accelerated filers (AFs) experience an increase in the likelihood of an originating misstatement following the acceleration of filing deadlines from 90 to 75 days. Large accelerated filers (LAFs), however, do not experience a similar increase following this acceleration or the subsequent acceleration from 75 to 60 days. After the implementation of the SOX Section 404 internal control requirements, we find that the likelihood of an originating misstatement declined for AFs but not for LAFs. Taken together, the findings suggest that, although AFs experienced an initial decrease in financial statement reliability, this decrease was temporary.

Keywords: accelerated filing, financial statement restatements, Sarbanes-Oxley Act, filing lags, internal controls

Suggested Citation

Boland, Colleen M. and Hogan, Chris E. and Bronson, Scott N., Accelerated Filing Deadlines, Internal Controls, and Financial Statement Quality: The Case of Originating Misstatements (August 5, 2013). Colleen M. Boland, Scott N. Bronson, and Chris E. Hogan (2015) Accelerated Filing Deadlines, Internal Controls, and Financial Statement Quality: The Case of Originating Misstatements. Accounting Horizons: September 2015, Vol. 29, No. 3, pp. 551-575., Available at SSRN: https://ssrn.com/abstract=3432710

Colleen M. Boland (Contact Author)

University of Wisconsin - Milwaukee - Sheldon B. Lubar School of Business ( email )

P.O. Box 742
3202 N. Maryland Ave.
Milwaukee, WI 53201-0742
United States

Chris E. Hogan

Michigan State University - Department of Accounting & Information Systems ( email )

270 North Business Complex
East Lansing, MI 48824-1034
United States

Scott N. Bronson

School of Business - University of Kansas ( email )

Capitol Federal Hall
1654 Naismith Drive
Lawrence, KS 66045
United States

Here is the Coronavirus
related research on SSRN

Paper statistics

Abstract Views
301
PlumX Metrics