Determinants and consequences of sales/production report issuance

Renhui Fu, Chen Ma, Yamin Zeng and Junsheng Zhang

The British Accounting Review, 2024, vol. 56, issue 5

Abstract: This study empirically examines the determinants and consequences of firms’ issuance of sales/production reports. Our findings demonstrate that firms choose to issue these reports in order to meet the information needs of investors, supply chain participants, and industry peers. As a result, these firms experience higher firm value, attributed to improvements in the information environment, increased trade credits, and strengthened tacit collusion. Our results remain robust when considering endogeneity and when replacing the binary issuance variable with the frequency of sales/production reports. Furthermore, the stock market shows a significant response to the information contained in these reports, reflected in larger abnormal returns and trading volumes, and the market reaction is positively related to the news conveyed by these reports. Overall, our findings indicate that the issuance of sales/production reports brings about economic benefits.

Keywords: Sales/production reports; Information environment; trade credit; tacit collusion (search for similar items in EconPapers)
JEL-codes: G17 G24 M48 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:bracre:v:56:y:2024:i:5:s0890838923001233

DOI: 10.1016/j.bar.2023.101266

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