Performance Disclosure Voluntary Disclosure, Accuracy And Market Response

There has been9years since the beginning of preliminary earnings estimates disclosure. Both SME Board and GEM companies which are required disclosing and Main Board which volunteer to disclose are along with an increasing disclosing ratio.Firstly at the motivation perspective, we start from building our sample which contains all the A share listed companies during2006-2011fiscal years. We found that motivation of equity refinancing, analyst-covering, nature of the actual controller, and signaling significantly raise the willingness of disclosure. In addition, the efficiency of corporate governance, including ownership concentration and the size of the board works well to promote preliminary earnings estimates disclosure. What’s more, firm characteristics are factors which cannot be ignored.Second, the further study on the accuracy of preliminary earnings estimates shows that, the accuracy is significantly related to some special factors such as analysts tracking, auditor’s opinion and message type. Corporate governance factors and firm characteristics also play a part. And we also found that there is a huge difference between compulsory and voluntary groups. In addition, these influencing factors vary with the accuracy.This article also examines the market reaction of the preliminary earnings estimates disclosure, It shows that in the compulsory group, accounting information releasing in the disclosure of preliminary earnings estimates makes the annual report of earnings response coefficients significantly lower than that of the voluntary group. And there exists a significant market reaction to accuracy after the release of the annual financial report, and the market reaction differences by the voluntary and compulsory group, high-reporting and under-reporting group.Implementation of preliminary earnings estimates policy improves the timeliness, reliability, and the quality of information disclosure. Our study enriches the literature of this field and also provides useful recommendations not only for listed companies and investors, but also regulators.