Johnson, Bret A.
[Verfasser:in]
;
Lisic, Ling Lei
[Sonstige Person, Familie und Körperschaft];
Moon, Joon Seok
[Sonstige Person, Familie und Körperschaft];
Wang, Mengmeng
[Sonstige Person, Familie und Körperschaft]
SEC Comment Letters on Form S-4 and M&A Accounting Quality
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments November 1, 2019 erstellt
Beschreibung:
Prior research on SEC comment letters has almost exclusively focused on reviews of periodic filings, such as 10-Ks. Transactional filing reviews, such as those related to mergers and acquisitions (M&A), are a fundamental priority of the SEC and to which it dedicates significant resources. We help fill the void in the literature by examining the influence of SEC comment letters on one type of transactional filing, Form S-4, on the accounting quality of the newly merged entity. We find that S-4s that receive an SEC comment letter are less likely to have a restatement or a goodwill impairment after the M&A deal is completed. Our inferences remain the same using either an entropy-balanced sample or a propensity-score-matched sample based on firm and deal characteristics. These results are stronger for S-4 comment letters with higher intensity and M&A-specific comments. Using path analysis, we find some evidence that the improved accounting quality is through S-4 amendments filed during the comment letter process. Overall, our findings provide evidence on the effectiveness of the SEC's transactional filing review process related to M&A deals