Investor reaction to accounting misstatements under IFRS: Australian evidence

John Goodwin, Yigit Atilgan, Serif Aziz Simsir and Kamran Ahmed

Accounting and Finance, 2020, vol. 60, issue 3, 2467-2512

Abstract: We examine the investor reaction to misstatement news for Australian listed firms from 2006 to 2013. We find 4.1 percent of firm‐years have a misstatement and 79 percent of misstatements are disclosed initially only in the periodic filings (stealth misstatements). We find no investor reaction for the average misstatement, reactions of between −2.3 percent and −2.8 percent (−1.5 and −1.7 percent) for misstatements that reduce prior‐period earnings or equity (affect revenue) and reactions of between −1.3 and −2.7 percent for non‐stealth misstatements. Investor reactions are more negative for non‐stealth misstatements that reduce prior‐period earnings or equity than for stealth misstatements.

Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://doi.org/10.1111/acfi.12395

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:bla:acctfi:v:60:y:2020:i:3:p:2467-2512

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0810-5391

Access Statistics for this article

Accounting and Finance is currently edited by Robert Faff

More articles in Accounting and Finance from Accounting and Finance Association of Australia and New Zealand Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().