The stock market reaction to fraudulent financial reporting

Raymond A.k. Cox, Thomas R. Weirich

Research output: Contribution to journalArticlepeer-review

14 Scopus citations

Abstract

Explores the impact that recent fraudulent financial reporting has had on the capital markets. Attempts to examine the stock market reaction, both to return and risk, to fraudulent financial reporting that has occurred in major corporations during the decade 19901999. Finds that capital market impact is significant in dollar terms with strong negative announcement effects the day before and on the day of a news event. Concludes that auditor and regulator vigilance needs to be strongly maintained in monitoring firms’ financial reporting.

Original languageEnglish
Pages (from-to)374-382
Number of pages9
JournalManagerial Auditing Journal
Volume17
Issue number7
DOIs
StatePublished - Oct 1 2002

Keywords

  • Capital markets
  • Financial reporting
  • Fraud

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