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dc.contributor.advisor Wahlen, James M. en Billings, Mary Brooke en 2010-06-01T22:01:25Z en 2027-02-01T23:01:25Z en 2010-06-11T13:53:32Z 2010-06-01T22:01:25Z en 2007 en
dc.identifier.uri en
dc.description Thesis (PhD) - Indiana University, Business, 2007 en
dc.description.abstract This paper considers the conflicting disclosure and trading incentives faced by managers who become aware of negative earnings news. Prior work indicates that potential legal and reputational consequences provide managers with incentives to voluntarily disclose this news. Despite these incentives, managers' warnings of negative news occur relatively infrequently. Therefore, I predict and test whether the receipt of negative news provides some managers with incentives to delay disclosing negative news in order to trade to exploit information asymmetries. I find a negative relation between abnormal trade by insiders prior to the market's receipt of negative earnings news and the timeliness of disclosure. Further analysis indicates that abnormal trade results in increased litigation consequences for the firm but only limited repercussions for managers. That is, after controlling for a number of factors argued to influence settlement negotiations, I document a positive relation between lawsuit settlement amounts and measures of abnormal trade, but I find no relation between abnormal trade and repercussions (in the form of employment turnover or SEC action) to managers involved in the trading. en
dc.language.iso EN en
dc.publisher [Bloomington, Ind.] : Indiana University en
dc.subject litigation en
dc.subject disclosure en
dc.subject legal liability en
dc.subject insider trading en
dc.subject.classification Business Administration, Accounting en
dc.title Tempting Trading Opportunities and Litigation Consequences en
dc.type Doctoral Dissertation en

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