In addition to papers available on SSRN, here are titles and abstracts of more recent working papers.
From Big Four to Wall Street: Sell-Side Analysts with Auditor Experience
Christian Andres, Francois Brochet, Peter Limbach, and Nicola Schumacher
February 2024
Abstract
Using hand-collected data, we provide evidence on the information and monitoring roles of sell-side equity analysts who previously worked in auditing. Former auditors issue more accurate and informative EPS forecasts. Firms covered by former auditors are less likely to report material misstatements, suggesting that they play a monitoring role. Further analyses suggest that the results are attributable to the combined accounting and industry knowledge acquired during several years of work in public accounting. However, stock recommendations from former auditors are no more profitable than those of their peers. Consistent with all the above, former auditors ask more accounting-related but fewer forward-looking questions than other analysts during earnings conference calls. Overall, our results highlight the extent and limits of skills transferability from public accounting to sell-side research.
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The Impact of Mandatory Closed Periods on Corporate Insider Trading
Francois Brochet
Boston University
Adriana Korczak
University of Bristol
Piotr Korczak
University of Bristol
Patricia Naranjo
Rice University
December 2023
Abstract: The Market Abuse Regulation (MAR), implemented in July 2016 in the European Union, mandates uniform closed periods by restricting insider trading 30 days before earnings announcements. We find a significant reduction in the occurrence and profitability of insider trading during closed periods in treated countries, i.e., those with no pre-MAR mandate. However, there is no significant decrease in market-level information asymmetry during closed periods, and price discovery is slower around earnings announcements. The study suggests that mandated closed periods effectively limit insider trading during sensitive periods but do not necessarily improve overall market outcomes compared to firm- or country-specific policies.