Measuring Readability in Financial Disclosures: Measuring Readability in Financial Disclosures

By Tim Loughran, Bill McDonald. 2014

884 citations recorded by the source corpus.

View Paper: https://www.semanticscholar.org/paper/b4ec409642616938f8f1daa36f25bcf39e3820f4

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Citations in the corpus

Hear Me Write: Does CEO Narcissism Affect Disclosure? (2019, methodology): “…number of highly cited studies have since used this methodology to measure tone of financial texts, and for consistency and reliability we follow the literature for this key variable in our study (e.g., Twedt and Rees 2012; Jegadeesh and Wu 2013; Liu and McConnell 2013; Loughran and McDonald 2014).”
The Evolution of 10-K Textual Disclosure: Evidence from Latent Dirichlet Allocation (2017, methodology): “…textual characteristics that have been identified by prior research as potentially affecting the informativeness of disclosure, including length ( Loughran and McDonald, 2014 ), readability ( Miller, 2010 ), boilerplate ( Lang and Stice-Lawrence, 2015 ), redundancy ( Cazier and Pfeiffer, 2015b…”
It Pays to Write Well (2017, methodology): “Loughran and McDonald (2014) find evidence that firms with less easily readable 10-”
The Economics of Disclosure and Financial Reporting Regulation: Evidence and Suggestions for Future Research (2015, neutral): “By aggregating across measures, these studies attempt to obtain a less specific (or summary) measure 19 See also Das (2014) and Loughran and McDonald (2014, 2016).”
Readability of 10‐K Reports and Stock Price Crash Risk (2019, positive): “Note, however, that the unmodified Fog Index may be misspecified in the context of financial disclosures (Loughran and McDonald 2014).”
Guiding Through the Fog: Financial Statement Complexity and Voluntary Disclosure (2016, neutral): “…and Thevenot, 2015), disagreement among credit rating agencies (e.g., Bonsall and Miller, 2013), reductions in the extent to which prices impound information (e.g., You and Zhang, 2009; Lee, 2012; Callen et al., 2013), and increased idiosyncratic volatility (e.g., Loughran and McDonald, 2014).”
Readability of Narrative Disclosures in 10-K Reports: Does Managerial Ability Matter? (2018, positive): “K document net file size (in megabytes, hereafter FILESIZE) (Loughran & McDonald, 2014).5 Loughran and McDonald (2014) suggest that the file size is a relevant and robust measure of the readability of financial disclosures.6 Finally, in the sensitivity analysis, as alternative measures of…”
Corporate Social Responsibility Report Narratives and Analyst Forecast Accuracy (2017, background): “In addition, firms that want to obfuscate its report could make the report lengthier (Loughran and McDonald 2014).”
Rumor Has It: Sensationalism in Financial Media (2015, methodology): “By identifying features of the text that predict accuracy, we also extend prior research on textual analysis in finance (Tetlock, Saar-Tsechansky, and Macskassy 2008; Loughran and McDonald 2011, 2014; Gurun and Butler 2012).”
The impact of narrative disclosure readability on bond ratings and the cost of debt (2017, neutral): “Although Loughran and McDonald (2014a) suggest the use of file size of the filing, Bonsall et al. (2016) suggest that this measure also has major shortcomings as the vast amount of the variation in the file size measure over time is driven by the inclusion of content unrelated to the underlying…”
Natural Language Processing in Accounting, Auditing and Finance: A Synthesis of the Literature with a Roadmap for Future Research (2016, background): “Studies employing basic text mining confirmed this phenomenon (Jones, 1988; Nelson & Pritchard, 2007; Lee, 2010; Loughran and McDonald, 2009, 2010, 2014; Miller, 2010; De Franco et al., 2012; Othman et al., 2012).”