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Sooner or later? A study of report timing

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  • Rahul Menon
  • Lin Nan

Abstract

This study examines the optimal reporting time a regulator should choose for firms to report their information when the firms' effort choices influence the outcome of projects. Our analysis shows that, the regulator's optimal choice of reporting time to maximize overall efficiency is contingent on a trade‐off between motivating a firm's effort to improve the outcome and saving the liquidation value for the creditor to reduce the firm's financing cost. We also find that to induce the firm's effort, the reporting time should be either early enough or late enough—depending on the effectiveness of the effort to turn bad projects into successes. Furthermore, we examine the regulator's optimal choice of reporting time for an economy with heterogenous firms/industries, and we show that the optimal reporting time changes nonmonotonically in the probability of good projects in the economy.

Suggested Citation

  • Rahul Menon & Lin Nan, 2023. "Sooner or later? A study of report timing," Production and Operations Management, Production and Operations Management Society, vol. 32(3), pages 762-779, March.
    • Handle: RePEc:bla:popmgt:v:32:y:2023:i:3:p:762-779
    DOI: 10.1111/poms.13897
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    References listed on IDEAS

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    1. Christian Hofmann & Naomi R. Rothenberg, 2019. "Forecast Accuracy and Consistent Preferences for the Timing of Information Arrival†," Contemporary Accounting Research, John Wiley & Sons, vol. 36(4), pages 2207-2237, December.
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    5. Ravi Sen & Joobin Choobineh & Subodha Kumar, 2020. "Determinants of Software Vulnerability Disclosure Timing," Production and Operations Management, Production and Operations Management Society, vol. 29(11), pages 2532-2552, November.
    6. Qi Chen & Zeqiong Huang & Xu Jiang & Gaoqing Zhang & Yun Zhang, 2021. "Asymmetric Reporting Timeliness and Informational Feedback," Management Science, INFORMS, vol. 67(8), pages 5194-5208, August.
    7. Xu Guan & Ying‐Ju Chen, 2016. "Timing of information acquisition in a competitive environment," Naval Research Logistics (NRL), John Wiley & Sons, vol. 63(1), pages 3-22, February.
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    9. Jeffrey T. Doyle & Matthew J. Magilke, 2013. "Decision Usefulness and Accelerated Filing Deadlines," Journal of Accounting Research, John Wiley & Sons, Ltd., vol. 51(3), pages 549-581, June.
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