Compliance and determinants of US-listed foreign firms' 20-F filings under the new Securities and Exchange Commission accelerated deadline. Issue 2 (11th May 2015)

• Record Type: Journal Article
• Authors: Chan, Kam C.; El-Gazzar, Samir; Jacob, Rudolph A.; Lee, Picheng
• Is Part Of: Journal of financial regulation and compliance. Volume 23:Issue 2(2015)
• Page Start: 161
• Page End: 178
• Publication Date: 2015-05-11
• Subjects: Financial institutions -- Law and legislation -- Periodicals; Banking law -- Periodicals; Financial services industry -- State supervision -- Periodicals; Banks and banking -- State supervision -- Periodicals; Independent regulatory commissions -- Periodicals; 346.082
• DOI: 10.1108/JFRC-02-2014-0008
• Languages: English
• ISSNs: 1358-1988

Abstract

<abstract> <title> <x content-type="archive" xml:space="preserve">Abstract</x> </title> <sec> <title content-type="abstract-heading">Purpose</title> <p> – The purpose of this paper is to investigate the impact of the US Securities and Exchange Commission (SEC) accelerated deadline on foreign firms, and the 20-F filing practices and factors relating to the filing lags. </p> </sec> <sec> <title content-type="abstract-heading">Design/methodology/approach</title> <p> – The authors identified 338 firms that file 20-F reports with the SEC during the period of 2010 and 2011. The authors then used multivariate regressions to examine the effects of the shortened deadline on foreign firms' filing practices and the factors associated with these practices. In the regression models, the authors also control for other firm characteristics that have shown to affect the filing lags of US firms such as firm performance, size, mergers and restructures, audit firm, compliance with internal control requirements under Sarbanes Oxley Act, internal control weaknesses, going concern audit opinion and operating complexity. </p> </sec> <sec> <title content-type="abstract-heading">Findings</title> <p> – Based on a sample of 338 US-listed foreign firms, the results indicate that there is a significant reduction in the filing lags and a change in their distribution for fiscal year 2011, as compared to the preceding year, and as intended by the SEC. The authors also find that 20-F filing lags are negatively related to the use of International Financial Reporting Standards (IFRS) or US-GAAP in 20-F reports and use of the English language in foreign firms' home countries. </p> </sec> <sec> <title content-type="abstract-heading">Practical implications</title> <p> – The findings of this paper are of interest to accounting regulatory bodies including the SEC, US Financial Accounting Standards Board and the International Accounting Standards Board by showing that registrants respond positively to regulations intending to promote timeliness of accounting disclosures and reporting, although many firms may oppose them in the due process stage. </p> </sec> <sec> <title content-type="abstract-heading">Originality/value</title> <p> – The authors contribute to the extant literature by providing new evidence that 20-F filing lags are negatively related to the use of IFRS or US-GAAP in 20-F reports, and the use of English language in foreign firms' home countries.</p> </sec> </abstract>