Influence of the comparability of financial reports on the transfer of information around the externalities of earnings announcements
DOI:
https://doi.org/10.5007/2175-8077.2021.e82445Abstract
The general objective of this research was to evaluate the influence of the comparability of financial reports on the transfer of information, considering the effects of externalities around companies earnings announcements. Comparability was measured using the accounting function similarity model; the transfer of information was measured using the event study technique and tested with regression analysis with panel data, from 2012 to 2018, in 122 Brazilian companies. The results are: (i) comparability is associated with the market reaction around the abnormal volume of trading, confirming that the companies' results announcements generate externalities of the information; (ii) the effect of comparability on the transfer of information does not depend entirely on the number of analysts who monitor the companies; and (iii) the transfer of information and comparability are associated with the reaction of the market when they are audited by the same audit firm.
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