University of Illinois Urbana-Champaign

How review ambiguity and access costs of SEC review correspondence affect investor judgments

Gale, Brian Thomas

Content Files
GALE-DISSERTATION-2019.pdf

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https://hdl.handle.net/2142/105164

Description

Title
How review ambiguity and access costs of SEC review correspondence affect investor judgments
Author(s)
Gale, Brian Thomas
Issue Date
2019-04-08
Director of Research (if dissertation) or Advisor (if thesis)
Elliott, W. Brooke
Doctoral Committee Chair(s)
Elliott, W. Brooke
Committee Member(s)
  • Brown, Nerissa
  • Hobson, Jessen
  • White, Tiffany
  • Williamson, Michael
Department of Study
Accountancy
Discipline
Accountancy
Degree Granting Institution
University of Illinois at Urbana-Champaign
Degree Name
Ph.D.
Degree Level
Dissertation
Date of Ingest
2019-08-23T20:44:39Z
Keyword(s)
  • review ambiguity
  • access costs
  • review correspondence
  • information processing
  • willingness to invest
  • reporting quality
Abstract
Review correspondence between the SEC and firms is a potentially valuable resource for investors. Review correspondence often reveals information about firms’ financial reporting quality, which has important implications for investors’ processing of financial information and investment judgments. However, there is little evidence on how characteristics of review correspondence influence investors’ decision processes. Drawing on psychology theory, I predict that two key informational characteristics—review ambiguity (i.e., a lack of transparency about outcomes from the SEC’s review process) and access costs (i.e., the amount of effort required to access review correspondence)—jointly influence investors’ information processing and their resulting investment judgments. Results show that investors integrate information to a greater extent as review ambiguity decreases, but only when access costs are relatively low. Review ambiguity has no effect on investors’ integration of review correspondence information when access costs are relatively high. Further, review ambiguity and access costs also jointly affect investors’ resulting investment judgments. My results provide important new insights on potential costs to investors from the extent of SEC transparency during its review process, particularly as information becomes more easily accessible.
Graduation Semester
2019-05
Type of Resource
text
Permalink
http://hdl.handle.net/2142/105164
Copyright and License Information
Copyright 2019 Brian Gale

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