Information overload and disclosure smoothing

Kimball L. Chapman, Nayana Reiter, Hal Derric White, Christopher D. Williams

Research output: Contribution to journalArticle

Abstract

This paper examines whether managers can reduce the detrimental effects of information overload by spreading out, or temporally smoothing, disclosures. We begin by attempting to identify managerial smoothing. We find that when there are multiple disclosures for the same event date, managers spread the disclosures out over several days. Managers are also more likely to delay a disclosure when there has been a disclosure made within the three days before the event date. Finally, managers are more likely to engage in disclosure smoothing when disclosures are longer, the information environment is more robust, firm information is complex, uncertainty is high, and disclosure news is more positive. Our second set of analyses examines whether there are market benefits to disclosure smoothing. Using two different measures of disclosure smoothing, we find that smoothing is associated with increased liquidity, reduced stock price volatility and increased analyst forecast accuracy.

Original languageEnglish (US)
JournalReview of Accounting Studies
DOIs
StatePublished - Jan 1 2019

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Smoothing
Information disclosure
Disclosure
Information overload
Managers
Analysts' forecasts
Forecast accuracy
Liquidity
News
Information environment
Uncertainty
Stock price volatility

All Science Journal Classification (ASJC) codes

  • Accounting
  • Business, Management and Accounting(all)

Cite this

Chapman, Kimball L. ; Reiter, Nayana ; White, Hal Derric ; Williams, Christopher D. / Information overload and disclosure smoothing. In: Review of Accounting Studies. 2019.
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Information overload and disclosure smoothing. / Chapman, Kimball L.; Reiter, Nayana; White, Hal Derric; Williams, Christopher D.

In: Review of Accounting Studies, 01.01.2019.

Research output: Contribution to journalArticle

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