“Information overload? An empirical analysis of SEC filing volumes and analyst forecast properties” by Dr. Yuan Zhang
Dr. Yuan Zhang
Associate Professor of Accounting
University of Texas at Dallas
We document that firms’ SEC filing volumes have expanded significantly under the SEC’s disclosure regime in the last two decades, in terms of both the number of filings and the total number of words filed. Further analyses show that the filing volume is significantly positively associated with analyst forecast dispersion. This result is robust to firm and year fixed effects, controls for firm fundamentals and activities, change analysis, and various identification strategies. We also find a negative effect of the filing volume on analyst forecast accuracy, particularly for filings other than periodic and current reports or for small firms and firms with high uncertainty. Overall, with respect to the corporate information environment, we show important costs, but little evidence of benefits, associated with the SEC filing volumes. Our novel focus on the SEC filing volumes sheds new light on the implications of information quantity and provides some initial empirical evidence on the “information overload” problem that the SEC has been concerned about regarding the Commission’s expanding filing requirements.
