Mandatory financial reporting frequency and market efficiency: evidence from Malaysia

Bee Wah Ooi, David Mayes, Dan Dhaliwal and Philip Shane

International Journal of Corporate Governance, 2020, vol. 11, issue 2, 109-128

Abstract: Effective corporate governance and protection of shareholder's rights necessitate timely disclosure of value-relevant information about the operations and financial position of firms with publicly-traded securities. This study examines whether regulations increasing the frequency of firms' periodic financial reports improves the information environment and accelerates price discovery in capital markets. Using a difference-in-differences research design, the study produces results showing post-regulation improvement in stock market efficiency. The findings contribute to the body of literature concerned with corporate governance, financial disclosure, and regulation of the flow of information from firms to investors and other stakeholders. The results have implications for policy makers in other emerging countries debating the pros and cons of quarterly financial reporting by firms raising capital in public markets.

Keywords: legal reform; reporting frequency; difference-in-differences; market efficiency; transparency; information content and timeliness; Malaysia. (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijcgov:v:11:y:2020:i:2:p:109-128

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