Repetitive Disclosures in the MD & A

This study is the first to empirically analyze repetitive disclosures in the Management Discussion and Analysis (MD) section of the 10-K filing. I define repetitive disclosures as the amount of content in the MD repeated from the notes. The Securities and Exchange Commission (SEC) believes that repetitive disclosures are uninformative and that such disclosures decrease the informativeness of other disclosures (non-repetitive) in the MD Building on research from the communication literature, I find evidence contradicting the SEC's views. First, repetitive disclosures are informative to investors and financial analysts. Second, repetitive disclosures increase the informativeness of non-repetitive disclosures, especially forindividual investors. I further examine whether there is a variation across firms in their use of repetitive disclosures. I find that firms with greater year-to-year absolute change in earnings, less powerful CEOs and more operational uncertainty are associated with more repetitive disclosures. Overall, my results suggest that repetitive disclosures are informative and such disclosures are likely an effective tool for providing information to investors and financial analysts.

Department dc:contributor.department

Management

Year dc:date.issued

2014

Author dc:creator

• Li, Heather Han

Advisors dc:contributor.advisor

• De Franco, Gus
• Hope, Ole-Kristian

• financial disclosures
• textual analysis

Handle dc:identifier.uri

http://hdl.handle.net/1807/72608

OAI identifier oai:identifier

oai:utoronto.scholaris.ca:1807/72608