The purpose of this study is to investigate whether biotechnology and health-care firms in Australia have poorer continuous disclosure (CD) practices as reflected in Australian Securities Exchange (ASX) queries relative to other firms.
Univariate tests and multivariate logit regressions are used to examine whether the frequency and nature of ASX queries and firms’ replies to price queries differ between biotechnology/health-care firms and the control firms.
Results suggest that biotechnology/health-care firms are more likely to receive volume queries and ASX Listing Rule 4.10 queries. They are also more likely to respond to price queries with new information relative to the control firms. However, biotechnology/health-care firms do not otherwise have statistically significantly different CD practice compared to the control firms, as reflected by the frequency and attributes of various types of ASX queries and by the way firms reply to price queries.
Evidence from this study can help evaluate the adequacy and enforcement of CD requirements and the need for further improvement. Investors can also use the evidence to better understand the information risks associated with investment in the biotechnology/health-care industry.
Prior research has not used multivariate methods to examine biotechnology/health-care firms’ CD practice in Australia or to examine accounting determinants of different types of ASX queries and firms’ responses to price queries.
This study has its roots in the honours thesis of Annabelle X. Ouyang and the PhD thesis of Grace Hsu at the UQ Business School, The University of Queensland. The authors thank the editor, Professor Ellie Chapple, and two anonymous reviewers for their comments and suggestions. They gratefully acknowledge the support of an AFAANZ research grant and the comments of participants of 2009 AFAANZ Conference, 2009 BAI Conference and 2014 APC Conference.
Hsu, G.C.-.-M., Clarkson, P. and Ouyang, A.X. (2019), "Do biotechnology and health-care firms have poorer continuous disclosure practices as reflected in ASX queries?", Accounting Research Journal, Vol. 32 No. 2, pp. 88-112. https://doi.org/10.1108/ARJ-12-2015-0152
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