Is CEO Certification of Earnings Numbers Value-Relevant?

Preprint

1 January 2002

preprint
Published by Elsevier in SSRN Electronic Journal

https://doi.org/10.2139/ssrn.332621

Abstract

On June 27, 2002, the Securities and Exchange Commission of the United States ordered the CEOs and CFOs of 688 large firms to certify the earnings numbers of their companies by 5:30PM EST, Aug 14, 2002. This paper uses this natural experiment to find that certification was not only a non-event for the certifiers around their certification date, but it was also a non-event for the non-certifiers around Aug 15, 2002. Further tests make us conclude that CEO's certification of earnings numbers is not value-relevant.

Keywords

EARNINGS TRANSPARENCY
CEO CERTIFICATION
CREDIBLE SIGNAL
ACCOUNTING REGULATION
SARBANES-OXLEY ACT

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