The Relevance of Form 8-K Reports

Carter, Mary Ellen; Soo, Billy S.

doi:10.2307/2491399

Cited by 121 publications

(56 citation statements)

References 7 publications

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“…These six topics account for two-thirds of all filings, whereas the rest are distributed across the remaining ones. Interestingly, the high share of, e. g., earnings results as a frequent topic in financial disclosures is also consistent with findings from the existing literature [e. g. 56]. Table 1 also rates the individual topics according to the aforementioned strategic dimensions, namely, risk and optimism.…”

Section: Descriptive Statistics Of Topicssupporting

confidence: 86%

Business analytics for strategic management: Identifying and assessing corporate challenges via topic modeling

Pröllochs

Feuerriegel

2020

Information & Management

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Strategic management requires an assessment of a firm's internal and external environment. Our work extends the body of management tools (e.g. SWOT analysis or growth-share matrix) by proposing an automated text mining framework. Here we draw upon narrative materials from firms (e.g. financial disclosures) and perform topic modeling in order to identify the key issues faced by an organization. We then quantify the use of language along two dimensions: risk and optimism. This reveals a firm's strengths and weaknesses by identifying business units, activities and processes subject to risk, while also comparing it to competitors or the market.

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Section: Descriptive Statistics Of Topicssupporting

confidence: 86%

Business analytics for strategic management: Identifying and assessing corporate challenges via topic modeling

Pröllochs

Feuerriegel

2020

Information & Management

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“…In the spirit of Carter and Soo (1999), we examine whether the 3-day return, volume, and volatility measures around the filing date differ for filings of varying filing lags-whether timeliness impacts informativeness of Forms 8-K. (Results reported in this section are not tabulated.) Since 95% of our sample represents forms filed within the four business-day deadline, these tests are significantly less powerful than those of Carter and Soo, who observed a large variation in filing lags.…”

Section: Impact Of the Filing Lagmentioning

confidence: 99%

The new Form 8-K disclosures

2009

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The Securities and Exchange Commission (SEC) has mandated new disclosure requirements in Form 8-K, which became effective on August 23, 2004. The SEC expanded the list of items that have to be reported and accelerated the timeliness of these reports. This study examines the market reactions to 8-Ks filed under the new SEC regime and investigates whether periodic reports (10-K/Qs) became less informative under the new 8-K disclosure rules. We observe that the newly required 8-K items constitute over half of all filings and that most firms disclose the required items within the new shortened period (four business days). We find that all disclosed items (old and new) are associated with abnormal volume and return volatility around both the event and the SEC filing dates, and some items have significant return drifts after the SEC filings. Surprisingly, we find that the information content of periodic reports has not diminished by the more expansive and timely 8-K disclosures under the new guidance, possibly indicating that investors may use periodic filings to interpret the effects of material events that had been disclosed earlier.

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“…The choice of this period takes into account the need to have a sufficiently large period to capture the market reactions around the event day, but not too long in order to avoid other effects or event overlaps, which could reduce significantly our sample. Brown and Warner (1985), Carter and Soo (1999), Seiler (2000), Kuipers et al (2002), Duque and Fazenda (2003) used similar time periods.…”

Section: Variables Definitionmentioning

confidence: 99%

“…In the U.S., Carter and Soo (1999) investigated the timeliness of stock price reaction to a sample of Form 8-K reports filed in 1993. The results show that the adjustment of stock prices to this form is small and generally occurs before the form disclosure.…”

Section: Introductionmentioning

confidence: 99%