Rights statement: This is an Author's Original Manuscript of an article submitted for consideration in the European Accounting Review [copyright Taylor & Francis]; European Accounting Review is available online athttp://www.tandfonline.com/doi/abs/10.1080/09638180.2011.640454"
Submitted manuscript, 413 KB, PDF document
Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
}
TY - JOUR
T1 - The effect of conference calls on analysts' forecasts
T2 - German evidence
AU - Bassemir, Moritz
AU - Novotny-Farkas, Zoltan
AU - Pachta, Julian
N1 - This is an Author's Original Manuscript of an article submitted for consideration in the European Accounting Review [copyright Taylor & Francis]; European Accounting Review is available online athttp://www.tandfonline.com/doi/abs/10.1080/09638180.2011.640454"
PY - 2013
Y1 - 2013
N2 - This study examines whether conference calls provide additional information to analysts. For a large sample of conference calls, hosted by German firms between 2004 and 2007, our results show that conference calls improve analysts’ ability to forecast future earnings accurately. This suggests that additional information is released during conference calls. The reduction in forecast error is economically significant and larger in magnitude when compared to results for the US (Bowen et al., 2002). These findings are consistent with the notion that commiting to additional disclosures is likely to yield greater effects in a less stringent disclosure system (Verrecchia, 2001). Since the majority of our sample firms conduct conference calls as closed calls, the evidence of this paper suggests that conference calls may contribute to an information gap between call participants and non-invited parties. Our findings should be of substantial interest to European regulators seeking to level the informational playing field for all investors.
AB - This study examines whether conference calls provide additional information to analysts. For a large sample of conference calls, hosted by German firms between 2004 and 2007, our results show that conference calls improve analysts’ ability to forecast future earnings accurately. This suggests that additional information is released during conference calls. The reduction in forecast error is economically significant and larger in magnitude when compared to results for the US (Bowen et al., 2002). These findings are consistent with the notion that commiting to additional disclosures is likely to yield greater effects in a less stringent disclosure system (Verrecchia, 2001). Since the majority of our sample firms conduct conference calls as closed calls, the evidence of this paper suggests that conference calls may contribute to an information gap between call participants and non-invited parties. Our findings should be of substantial interest to European regulators seeking to level the informational playing field for all investors.
KW - Analyst Conferences
KW - Conference Calls
KW - Disclosure Regulation
KW - Financial Analysts
KW - Forecast Accuracy
KW - Information Environment
U2 - 10.1080/09638180.2011.640454
DO - 10.1080/09638180.2011.640454
M3 - Journal article
VL - 22
SP - 151
EP - 183
JO - European Accounting Review
JF - European Accounting Review
SN - 0963-8180
IS - 1
ER -