Discussion of Evidence on the Incremental Information Content of Additional Firm Disclosures Made Concurrently with Earnings

Abstract

The stated purpose of this study was to assess the incremental information content of additional firm disclosures made concurrently with annual earnings announcements. The discussion regarding the motivation took two forms. First, if nonearnings information is of interest, it was argued that the analysis should not be limited to disclosures made concurrently with earnings. This constraint introduced two problems. (1) It reduced the scope and amount (sample sizes) of disclosures available for analysis. (2) It required that earnings expectations models be used, so that the effects of earnings information could be controlled for.' An alternative to confining the analysis to the earnings announcement date would be to examine the information content of dividend announcements, qualitative comments by officers, and operating data on other (nonearnings announcement) dates. This would accomplish several things. It