Iatridis, George, Pappas, Kostas 
ORCID: 0000-0003-3012-0858 and Walker, Martin
(2021)
Narrative Disclosure Quality and the Timeliness of Goodwill Impairments.
British Accounting Review, 54 (2).
p. 100978.
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Abstract
Abstract This paper studies the relation between the quality of corporate narrative disclosure and the timeliness of goodwill impairments. We combine five measures of the linguistic content of annual report narratives to generate a proxy for narrative disclosure quality. To measure the timeliness of impairments, we deploy a model that relates observed goodwill impairments to the main determinants of impairments identified by prior literature, focusing especially on current period negative stock returns. We hypothesise and find that the impairments of firms with low-quality narrative disclosures are less timely than the impairments of firms with high-quality disclosures. In addition, using a signalling argument, we hypothesise, and find that the market response to goodwill impairments is more negative for firms with low disclosure quality.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | Annual report narratives, Disclosure quality, Goodwill impairments, Signalling, Timeliness |
| Depositing User: | Symplectic Admin |
| Date Deposited: | 26 Jan 2021 11:14 |
| Last Modified: | 31 Jan 2023 02:30 |
| DOI: | 10.1016/j.bar.2021.100978 |
| Related URLs: | |
| URI: | https://livrepository.liverpool.ac.uk/id/eprint/3114821 |
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