Internal Financial Impacts of the SEC's Accounting and Auditing Enforcement Releases

摘要

The number of U.S. Securities and Exchange Commission (SEC) enforcement actions has increased in recent years, culminating in a record number of filings in 2011. This highlights the need for additional research in this area. This paper addresses this need by examining the internal financial impacts of SEC sanctions on corporations. We compare corporations that have received one type of SEC sanction, Accounting and Auditing Enforcement Releases (AAERs), to similar companies that have not. Our results show significant differences between the two groups. Accordingly, this paper should be of interest to practitioners, academics, and researchers in this area.