Accounting Scandals And Stock Performance: Life After Enron

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Matiur Rahman
Daryl V. Burckel
Muhammad Mustafa

Keywords

Earnings Restatements, Event Study, Cumulative Abnormal Return, Market Portfolio, CAPM

Abstract

This paper studies the effects of earnings restatements of selected ten U. S. companies by implementing the event study methodology. The effects are asymmetric across these companies as they are heterogenous in terms of industry classifications. The effects are also conditional upon the fraud and coming-out-clean perceptions about them. Additionally, the effects are dependent on the demand prospects for their products and services.

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