This study examines reactions of financial analysts to the disclosure of corporate fraud. We posit that analysts … downgrade earnings forecasts of fraud firms after fraud disclosure to signal their quality and integrity. We explore how … downgrades, and consequently affect their responses to corporate fraud. Using longitudinal data on Chinese publicly traded firms …

The revelation of accounting fraud by the Olympus Corporation gave rise to shareholder allegations of audit failure … affecting the reputation of Olympus' auditors. First, we use a nonparametric generalized rank event study methodology on 918 … reputation as proxied by abnormal returns. Second, we perform a multivariate linear regression on firms' abnormal returns after …

against it, i.e., cases of fraud or cheating, or payment default attract a much more negative reaction as compared to cases …

Event studies have become increasingly important in securities fraud litigation, and the Supreme Court’s 2014 decision … event study methodology and identifying the limitations on its use in securities fraud litigation. It begins by describing … features of securities fraud litigation that cause the statistical properties of event studies to differ from those in the …

We investigate the impact of fraud risk - measured by the probability for earnings overstatements - on a firm's future … stock market performance. Based on an out-of-sample estimation of individual firms' fraud risk, we find that stocks with … higher fraud risk earn significantly lower stock market returns. A long-short trading strategy delivers a statistically …