| Abstract: | The practice of preparing and issuing Employee Reports to an organization's work force is now well established throughout many countries. A survey of companies listed on New Zealand's stock exchange (Firth and Smith 1984, p. 5) indicated that about 22% of responding companies produced Employee Reports. These Employee Reports often contain data that are not present in the firm's Annual Report and Accounts, and this has potential usefulness to stock market investors. If Employee Reports do have usefulness to stock market investors, then this raises policy issues about current disclosure requirements to shareholders. In particular, it heightens concerns about whether the shareholders are being given timely and adequate information. In order to test whether Employee Reports do have any incremental information content, an abnormal returns analysis on 88 reports was carried out. The results showed no evidence of abnormal returns, and so the incremental data contained in Employee Reports either have no usefulness for investors and/or the information has been discounted from other sources. |
