Interim Reporting Frequency and Financial Analysts Expenditures
Journal of Business, Finance, and Accounting, Vol. 31, pp. 41-72, 2004
37 Pages Posted: 4 Jan 2004
This article relates interim financial reporting frequency in a multiperiod Kyle framework to securities prices, trading volume, market liquidity, and analysts' information acquisition expenditures. The model supports conventional wisdom that more frequent interim reporting improves the information content of securities prices, reduces reporting day price volatility and trading volume, and enhances market liquidity. However, the model also suggests that more frequent financial reporting induces analysts to increase their redundant information acquisition expenditures, which may be socially wasteful.
Keywords: Interim reporting frequency, earnings announcements, analysts
JEL Classification: M41, G12, G14, G29, K22, D82, D83, D52
Suggested Citation: Suggested Citation