2014/01/30 by FRANK GIGLER, Frank Gigler, Chandra Kanodia +5 · 240 citations
Business, Management and Accounting · Economics, Econometrics and Finance · #Accounting #Actuarial science #Auditing, Earnings Management, Governance #Business #Capital (architecture) #Capital expenditure #Capital market #Computer science #Cost of capital #Economics #Finance #Financial Markets and Investment Strategies #Financial Reporting and Valuation Research #Microeconomics #Monetary economics #Value (mathematics)
paper · doi:10.1111/1475-679x.12043
published in Journal of Accounting Research 52(2), 357-387 (Wiley)
openalex publication_date 2014/01/30 · openalex created_date 2025/10/10 · openalex updated_date 2026/08/05
ABSTRACT We develop a cost–benefit tradeoff that provides new insights into the frequency with which firms should be required to report the results of their operations to the capital market. The benefit to increasing the frequency of financial reporting is that it causes market prices to better deter investments in negative net present value projects. The cost of increased frequency is that it increases the probability of inducing managerial short‐termism. We analyze the tradeoff between these costs and benefits and develop conditions under which greater reporting frequency is desirable and conditions under which it is not.