Economic consequences of SEC regulation pertaining to financial expert definition

Steve A. Garner, Paul D. Hutchison and Teresa L. Conover

Advances in accounting, 2017, vol. 36, issue C, 75-86

Abstract: This paper examines the economic effects of issue dates pertaining to the definition of audit committee financial expert regulation by the U.S. Securities and Exchange Commission (SEC) and discussion of the definition by news services on firms traded on U.S. equity exchanges. This research study uses the methodology of Zhang (2007) to extend DeFond, Hann and Hu (2005) and Krishnan and Visvanathan (2008) by using event dates previously untested to provide additional insights regarding SOX regulation and market perceptions of this required disclosure of voluntary appointment of financial experts to corporate audit committees. Using stock market returns, the findings from this study suggest that companies traded on U.S. capital markets and subject to SEC regulatory requirements experienced significant negative returns around SEC financial expert regulation event dates, while media disclosure events were mostly not significant. Also, larger firms were more negatively impacted than smaller firms by this new SOX requirement.

Keywords: Corporate governance; Audit committee; Financial expert; SEC regulation (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0882611016300190
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:advacc:v:36:y:2017:i:c:p:75-86

DOI: 10.1016/j.adiac.2016.11.002

Access Statistics for this article

Advances in accounting is currently edited by Dennis Caplan

More articles in Advances in accounting from Elsevier
Bibliographic data for series maintained by Catherine Liu ().