Financial Reporting Qualitative Interview Based Research: A Primer with An

Illustrative Example

Steven E. Salterio, Stephen J.R. Smith School of Business, Queens University

Staci Kenno, Goodman School of Business, Brock University

Susan McCracken, DeGroote School of Business, McMaster University

For Comment Only. Please do not cite without prior permission.

June 1, 2016

The first author thanks the doctoral students at the University of Florida who participated in the Field Research
Methods special seminar in the winter of 2015. We also acknowledge the ongoing support of the Social and
Behavioral Accounting Brown Bag at Queens Smith School of Business for their discussions of our work especially
Bertrand Malsch and Pamela Murphy.

Electronic copy available at: http://ssrn.com/abstract=2792438

 Financial Reporting Qualitative Interview Based Research: A Primer with An Illustrative
Example
Abstract

Responding to increased calls for financial reporting researchers to enter the field, the goal of

this article is to provide a basic primer on how to conduct field-based research using qualitative

interview methods. We start by reviewing the extant, but limited, field research literature in

financial reporting. We then assemble a set of resources that facilitate transfer of explicit (also

known as declarative, codified or textbook) knowledge about the interview method. Next,

following knowledge transfer theory we attempt to bridge the knowing-doing gap by

reviewing how we carried out a study on earnings press release creation process. This example

driven approach allows us to not only illustrate how explicit knowledge of interview-methods

can be applied, but also provides a means to highlight the tacit knowledge about implementation

issues and choices. By following the advice in this article, novice field researchers in financial

reporting will gain a basic fluency in qualitative interview-based methods that will enable them

to more readily acquire the knowledge and skills to respond to the challenge of going into the

field and conducting valid, reliable, field based financial reporting research.

Electronic copy available at: http://ssrn.com/abstract=2792438

 Financial Reporting Qualitative Interview Based Research: A Primer with An Illustrative
Example

In recent years, leading general interest accounting journals (e.g., Soltes 2014a in Journal of

Accounting Research) have increased calls for field research to be carried out in financial

reporting. Indeed, the new section journal of the American Accounting Associations (AAA)

Financial Reporting Section (FARS), the Journal of Financial Reporting (JFR), explicitly states

that a large part of its mission is to provide an outlet for research that fills perceived gaps in

current journals. In particular, JFR wants to publish Research using underrepresented methods

such as field studies, small sample studies and analysis of survey data. Given the lack of

training in qualitative research methods in most English-speaking doctoral programs, this article

provides direction towards closing this important gap in the research methods training of

financial reporting researchers. While there are many types of field methods (see Bloomfield,

Nelson, and Soltes 2016 for a discussion of this),1 in this article we focus on the qualitative field

interview where the goal is to better understand the world from the perspective of the

participants who take part in it. As the premiere niche journal for behavioral accounting research,

it is appropriate that Behavioral Research in Accounting lead a discussion on how to carry out

qualitative interview research.

Most accounting researchers interested in financial reporting issues have training in

archival research methods, with a small minority having training in analytical and experimental

1
Soltes (2014a) reminds us that field data can take many forms, including information from private databases within
organizations and surveys of particular field phenomena, and not just the interview-based methods used to collect
data that we call a field study in this paper. Further, others note (e.g., Ittner 2014) the ability to combine qualitative
methods with other forms of field data can make such studies much richer. Indeed, a large part of what Soltes
(2014a) does is to add a layer of field research onto a detailed archival markets study to provide a very different
interpretation of that studys results than what the authors had originally suggested (see Iliev, Miller, and Roth
2014).
research methods (Kinney 2003). Hence, if such researchers are to take up the call to conduct

field based studies, resources need to be made available to educate and train researchers on how

to do this type of research, at least until doctoral programs adapt to include the training of

rigorous field methods as part of their curriculum.2

The purpose of this paper is to provide basic guidance to financial reporting researchers

on how to carry out interview-based field research. We assemble a set of resources that facilitate

transfer of explicit (also known as declarative, codified or textbook) knowledge about the

interview method. Following the guidance from knowledge transfer theory (e.g., Szulanski 2000)

we emphasize research methods literature from closely related fields (i.e. management

accounting and auditing) and organize the resources by research stage to facilitate the knowledge

transfer. Further, following knowledge transfer theory, we recognize that acquisition of tacit

(also known as implicit or how to do) knowledge is needed to facilitate implementation of that

explicit knowledge (e.g. Nonaka and von Krogh 2009). Hence, we follow a key knowledge

transfer approach designed to bridge the knowing-doing gap (see Pfeffer and Sutton 2013) by

illustrating how to plan, conduct, and analyze the data collected in an actual interview-based

study we conducted on the creation process of public companies earnings press releases.3

We also address two myths about carrying out qualitative interview-based research.

First, there are researchers who believe that carrying out field research is a simple matter of

2
It should be noted that other disciplines in North American business schools offer coursework in qualitative
methods. For example, Harvard Business Schools doctoral program offers two courses in qualitative methods in the
management area (see http://projects.iq.harvard.edu/qualitative/pages/courses).Where such courses are not found in
business doctoral programs, they can be readily found in sociology departments. For example, at the University of
Pennsylvania, where Wharton Business School is located, the course SOC 604 focuses on qualitative methods (see
https://sociology.sas.upenn.edu/pc/course/2015A/SOCI604).
3
The study was never completed due to the exogenous shock of the financial crisis of 2008, which shut down access
to those involved in the earning press release process, given the gravity of the situation that faced managers at that
point in time. However, it makes an excellent exemplar of how to prepare for and execute interview-based field
research on a financial accounting research related topic.

2
going out and talking to people. Further, they believe anyone can do it with little or no training

and/or preparation. If novice researchers enter the field unprepared, the resulting research will

have little validity with the most likely result of simply confirming the researchers pre-existing

beliefs and interpretations and not reflect knowledge and insights that the researcher sought to

gain from entering the field. Second, there are some field researchers, trained in an interpretive

methodological research tradition (see Appendix A), that believe a researcher needs years of

specialist training along with a particular set of epistemological and ontological beliefs in order

to be qualified to carry out field research. Both of these myths are harmful to the evolution of

field research in accounting (see Malsch and Salterio 2016).

The basis for our claim to expertise is this area is that as an author team we have

collectively carried out seven full scale field studies, each including a large interview

component, that have led to the publication of seven articles (with more coming given one

project is only recently in working paper form) in top tier accounting journals over a twenty

plus year period (e.g., Salterio 1994, 1996; Salterio and Denham 1997; Gibbins, Salterio, and

Webb 2001; McCracken, Salterio, and Gibbins 2008; Free, Salterio, and Shearer 2009) in

addition to others in top niche journals (e.g. Gibbins, McCracken and Salterio 2005). Further,

two of the three authors did not receive formal doctoral level education in field research methods

as part of their doctoral programs, allowing them to identify with the financial reporting

researcher looking to educate themselves in interview methods. The third author received

education in qualitative research methods, thus, bringing rigorous methodological knowledge to

the study that complements the self-training of the other authors. Finally, one of the authors has

edited and reviewed in excess of fifty field studies in his time as an Editor (in-chief), Editor, and

reviewer and the other two authors have reviewed multiple field studies for top tier journals.

3
Hence, collectively we are uniquely qualified to discuss how one self-educates on how to carry

out high quality field research.4

We begin the paper with a brief discussion of what is field research in financial reporting,

including a review of the handful of recent studies that have been carried out and published that

employ a combination of survey research followed by interviews (e.g. CFOs, sophisticated

investors, analysts etc.). We then note the theoretical support from research on knowledge

transfer (e.g. Nonaka 1994) that provides the basis for the approach we take in writing this

article. Following that literatures approach, we proceed to discuss the declarative (or

textbook) knowledge necessary to understand qualitative interview based research. We then

employ an exemplar field study in financial reporting on the creation of earnings press releases

(EPR hereafter) in public companies to aid in transferring of tacit (or how to do) knowledge

about interview based research. We explain, using the rationale we used in carrying out the

research, the motivation to enter the field to investigate EPR, our situating ourselves in the

academic and regulatory literature in preparation for creating the interview protocol (the formal

title for the document containing questions to be posed to interviewees), the development of our

interview protocol, the approaches used to obtain interview informants (the formal term in the

literature for those interviewed), and how we approached the analysis and reporting of qualitative

data (the formal term for the data produced from an interview albeit it is used to cover more data

than just interviews). We conclude our methods introduction with suggestions for managing a

pilot project so that the skills needed to carry out such a study can be refined prior to undertaking

a full scale study.

What is field research in financial accounting?

4
We also hope this article will be of use to accounting doctoral program administrators and supervisors in aiding
their students in selecting coursework that will help them acquire formal training in qualitative research methods.

4
The American Economic Review colloquially describes field research as involving interviews

with economic actors and visits to places they live and work (Helper 2000,228). Similarly,

Merchant and Van der Stede (2006, 118) describes field investigations as studies that involve

in-depth study of real-world phenomena through direct contact with the organizational

participants.

Among the advantages Merchant and Van der Stede listed for field research are: 1) the

study of accounting practices in their natural setting facilitates the generation of relevant

theory; and 2) it provides rich descriptions of practice that are particularly effective for

theory building (118). Furthermore, Merchant and Van der Stede note that field studies can be

used effectively for testing and refining existing theories (119), including the interpretation of

certain data regularities when multiple theories can be used to interpret the data. Helper (2000)

adds, from an economics research perspective, that field research allows researchers to ask

people directly about their objectives and constraints, facilitates use of the right data and

provides vivid images that promote intuition. (228-229).

Merchant and Van der Stede (2006) indicate that field research is well established in

management accounting (with over 250 field studies published in the years 1981 to 2004

including over 80 studies published in the so called top five accounting journals) and has been

increasing in auditing (27 studies published in the period 1981 to 2004 including 17 in top five

journals). In addition, we observe that Contemporary Accounting Research (CAR) alone has

published nine management accounting interview-based studies since 2005, compared to two in

the period 1984-2004; and ten auditing interview-based studies since 2005, compared to three in

the period 1984-2004. Thus, interview-based field studies in those domains certainly have made

an ongoing and increasing impact on that research literature.

5
 Yet, field research is rarely found in financial reporting (21 studies in the period 1981-

2004 with only six of those in top five journals) according to Merchant and Van der Stede

(2006). We observe that CAR has published only two financial accounting field studies since

2004 versus one published in the period 1984-2004. Furthermore, most of the extant financial

accounting field research has been carried out in the interpretive paradigm (see Appendix A for

an introduction to interpretive financial reporting research). While such research is academically

important and valid (e.g. see Malsch and Salterio 2016 for a discussion of how interpretive

research and positivist research can complement each other), it is less likely to be of interest or

helpful to the understanding of financial reporting topics that are the dominant interests of

analytical, archival, and experimental financial reporting researchers.5

There has been a slow but steady growth, in recent years, in financial reporting field

research in the top five journals using mixed methods survey data plus qualitative interviews

(e.g., Graham, Harvey, and Rajgopal 2005, Dichev, Graham, Harvey, and Rajgopal 2013,

Brown, Call, Clement, and Sharp 2015). Graham et al. (2005) is the first study of its kind that

was published in top tier accounting journals and was the winner of the AAA Notable

Contribution to Accounting Research Award in 2006.6 While this study focuses on a random

sample survey of financial executives who are members of the FEI, the researchers employed

qualitative interviews to serve as a check on the interpretations they made from the survey data.

5
For example, Stolowy, Messner, Jeanjean, and Baker (2014) investigate how financial reporting and other related
practices were employed in the Madoff case to create an illusion of trustworthiness. Neu (2012) shows the
financial accounting related effects (among others) of undocumented workers (i.e. illegal immigrants to a country) in
an interview-based study of the restaurant industry. The connection of these issues to the concerns of analytical and
empirical (including experimental) financial accounting researchers is likely to be limited. Appendix A provides
pointers to articles in this paradigm and provides an introduction to the methodology.
6
Research on the auditor-client management interactions over the contents of the financial statements dates back to
2001 (Gibbins, Salterio, and Webb 2001) using a variant of the survey method called the experiential questionnaire
(see Gibbins 2001, Gibbins, and Qu 2005, and Salterio and Gondowijoyo 2017) as well as interview data
(McCracken et al. 2008). We exclude this literature from this paper, even though it focuses on CFOs (e.g. Gibbins,
McCracken, and Salterio 2007), because of its close links to the audit issues. For a review of this negotiation
research see Salterio 2012.

6
The authors discuss how their field study was designed to triangulate with analytical and archival

financial accounting research addressing the same questions. They advocated the use of

interviews as an opportunity to reinforce or clarify the survey responses but not as a research

method that provided valuable original data.7

The subordination of interview data to the more rigorous survey data has been

diminishing as researchers gained experience gathering such data. For example, Dichev et al.

(2013), building off Graham et al. (2005) approach, use both surveys and interviews as well.

However, Dichev et al. start the research by conducting pre-survey interviews to help them scope

the nature and extent of the survey questions. They also conducted post-survey interviews to

clarify the main findings of the survey, but with an added focus on investigating the surprising or

unexpected results from the survey during their interviews.

The interview data began to play a more equal role with the survey data in the reported

findings as financial reporting field researchers became more sophisticated with use of interview

data. For example, Brown et al. (2015) builds off an archival study by Soltes (2014b) that

investigated, using a set of proprietary field based data, the private interactions between firm

management and sell-side analysts. Brown et al. extend Soltes (2014b) research by directly

surveying and interviewing analysts to gain a deeper understanding of their interactions and

decisions. Brown et al. (2015) used the interviews to corroborate what was found in their survey

and in the archival data. However, they went beyond corroboration by using the interview data

to report additional findings based solely on the interview data. This added reliance on interview

based evidence can see seen in the papers results section where there is an increased use of

7
It is interesting to note that the authors spend a considerable amount of space defending the use of surveys and
interviews by discussing the weaknesses of existing archival research and how their field research overcomes these
weaknesses.

7
interview quotes interspersed throughout the survey data analysis, rather than the interview data

being included in a supplementary section to the main analysis that was in previous papers the

survey data. Brown et al. (2015) illustrates an increasing level of researcher (and editor/reviewer)

comfort with interview data as a primary research method.

Yet to date, no study has been published in a top tier accounting journal on a financial

reporting topic that is solely based on interview data.8 Table 1 summarizes financial reporting

field studies published over the past decade. Populations sampled from have included financial

executives, especially CFOs (e.g., Graham et al. 2005), financial analysts (e.g., Yoo and Pae

2016), and tax executives (Graham, Hanlon, Shevlin, and Shroff, 2014). Topics have included

voluntary corporate disclosure decisions (Graham et al. 2005; Jong, Mertens, Poel, and Dijk

2014), earnings quality (Dichev et al. 2013), and firms incentives and disincentives for tax

planning and avoidance (Graham, Hanlon, Shevlin, and Shroff, 2014). However, we are still in

the infancy of financial reporting field research, as Table 1 represents a census of studies

published in top tier accounting journals to the start of 2016, not just a sample.

Effective Knowledge Transfer the Knowing-Doing Gap

We draw on the knowledge transfer research to guide us as to how to introduce financial

reporting researchers to interview-based methods. These methods produce qualitative data, hence

the use of the term qualitative interview-based research. The knowledge transfer research

recognizes that any attempt at transfer has a certain degree of stickiness to it (Szulanski 2000).

8
There have been a handful of exclusively interview-based articles published in accounting, outside of the top tier
journals, which adopted a positivist research methodology orientation that is the focus of our article. These include:
Holland (1998) on private disclosures UK public companies made to institutional shareholders in the early 1990s;
Cowton (2004) on the interplay among ethical investment fund managers between financial and ethical performance
information use in purchasing stocks within one ethical mutual fund; and Mayorga (2013) on how firms manage
their continuous disclosure obligations to stock markets in Australia.

8
That literature (e.g., Szulanski 2000) observes that difficult knowledge transfers are more likely

to involve complex and causally ambiguous practices, like the qualitative interview methods we

focus on. Further, the knowledge transfer research reminds us that to transfer knowledge one

must focus not only what the party attempting the transfer seeks to achieve but also needs to on

build off the existing capabilities of the recipient (Hansen and Hass 2001).

Knowledge transfer theories suggest that there are two main types of knowledge that

must be acquired in order for knowledge transfer to occur: explicit and tacit (Nonaka and von

Krogh 2009). Explicit knowledge (also known as declarative, codified or textbook knowledge)

can be defined as knowledge transmitted in a formal, systematic language (Nonaka and Takeuchi

1995, 59) that can be learned through the creation of documented models and processes (Nonaka

and Takeuchi 1995; Szulanski 1996; Morris and Empson 1998; Hansen, Nohria, and Tierney

1999; Hansen, 2000). Guidance from knowledge transfer theory (e.g., Szulanski 2000) that

suggests any new explicit knowledge must be synthesized into existing knowledge via a

process during which new, useful, practical, valid and important knowledge is connected to the

knowledge system (Nonaka, von Krogh, and Voelpel 2006, 1183). Hence, we emphasize and

provide reference to research methods literature from closely related fields (i.e. management

accounting and auditing). Second, to further aid in the acquisition of explicit interview based

methods knowledge, we organize the references according to the stages of research process (e.g.,

planning through to reporting) as a means of presenting the large literature on qualitative

interview based methods (Hansen and Hass 2001).

Tacit knowledge can be defined as somewhat context specific knowledge about how to

implement the explicit knowledge that is being acquired so that the knowledge can be used

(Nonaka and Takeuchi 1995, 59). In addition, tacit knowledge includes knowledge that cannot be

9
readily codified but is necessary to perform a task (Nonaka 1994). Knowledge transfer research

suggests that providing exemplars with reflections about why activities were undertaken aids in

conveying tacit knowledge and helps the novice with the acquisition of the explicit knowledge

(Nonaka, von Krogh, and Voelpel 2006). Thus, after introducing the explicit knowledge about

qualitative interview-based research, we focus our knowledge transfer activity on the reporting

of an actual study of the EPR creation process, including our reflections about the choices we

made and alternatives that could have been employed. Both of these approaches, the organization

of closely related fields explicit research methods knowledge by research stage and the use of an

exemplar to aid in the acquisition of tacit knowledge, are designed to address the knowing-

doing gap (Pfeffer and Sutton 2013) that hinders knowledge transfer.

By applying knowledge transfer theory to provide guidance on how to do interview

based research in financial reporting we replicate the approach employed by the two authors who

did not have formal instruction in qualitative methods to acquire their methods knowledge.

Hence, the relative success that these authors enjoyed along with the principled theory based

approach to knowledge transfer aid us in debunking the myth that years of specialized training

are required to successfully conduct interview based field research.

Codified Knowledge: Field Research Methods Resources

Given that knowledge acquisition theory suggest that novice researchers need to acquire

certain explicit knowledge to conduct interview based research in financial reporting, Table 2

provides a list of resources that will help develop that explicit knowledge organized by stage of

the research process. Rather than attempting to summarize the contents of these resources we

make four general points about how to use them to develop the requisite explicit knowledge.

10
 First, Table 2 presents a number of general overview of the method type articles,

followed by references to articles related to the three stages (planning and doing, analyzing, and

writing up) of conducting interview-based research, concluding with a set of references about

how to evaluate qualitative research. This classification of methods articles, by its very nature is

arbitrary, and with rare exceptions for articles with very limited focus (e.g. Morse 1995 on

saturation), most references at least touch on other aspects. We have also chosen to include a

couple of classic references from qualitative methodology based references (see Appendix A)

that we found particularly helpful in gaining our own appreciation and understanding of how to

do field research. Baxter and Chua (1998) describes the process of field research by contrasting

the what was being done in the field as activities during the study with the thoughts of the

junior field researcher about what she was doing during those activities. Baxter and Chua

(1998) is one of the rare studies that directly focuses on what the researcher experiences while

carrying out research in the field. We believe it warrants attention, especially from novice field

researchers.9

Second, many of the articles refer to case study research where the aim of the research

is to achieve an in-depth understanding of a handful of research sites or organizations.10 The

focus on in-depth engagement in one or a limited number of organizations found in these

methods articles may seem, on the surface, to be rather different than the interviewing of many

individual informants across a number of organizations focused on a clearly defined topic (e.g.,

the creation of EPR). However, the how to do advice and knowledge contained in these

9
This paper has been extensively used by one of the authors in doctoral seminars around the world, including
seminars at predominantly archival financial accounting doctoral programs.
10
It is important that the reader not confuse case study research with the practice at many business schools of
writing teaching cases. Teaching cases, some of which may reflect interviews with the case participants, are
designed to focus on pedagogical issues and are not researched or written with the rigour that is required for case
study research. See Chapter 1 of Yin (2014) for a further understanding of the different objectives of a teaching case
versus a research case.

11
research case study resources can be readily adapted by the researcher to carry out cross

sectional interview studies of the type employed currently in accounting research.

Third, all three authors of this study have benefitted significantly from reading and re-

reading Yins classic methods monograph entitled, Case Study Research: Design and Methods,

now entering its fifth edition (Yin 2014). In a short (less than 200 page) book, Yin walks the

novice field researcher through the entire process of carrying out interview-based study. He

illustrates the research process with numerous examples of studies he has been involved with,

mainly from the sociological and education literatures. We highlight the impact of this reference

book on our thinking by listing it by chapter under each of the research stages in Table 2.

Finally, we acknowledge we have cherry-picked references from among the vast

qualitative methods literature in the social sciences, including business. Indeed, we have not

included all of the methods articles written in auditing and management accounting that provide

insights into carrying out interview-based qualitative research. Table 2 is an attempt to provide a

convenient and focused, yet comprehensive, starting point for the financial accounting researcher

eager to go into the field. Furthermore, we do not suggest that one has to read every reference in

Table 2 prior to going into the field. One or two articles from the overview section, combined

with careful reading of Yins monograph and Baxter and Chuas (1998) real world perspective

on doing research will provide a solid foundation upon which a novice research can build their

qualitative interview-based research skills. Of course, over time the researcher will want to

invest in a greater depth of research methods education and other sources on this list can be

consulted

Transferring Tacit Knowledge: Creating Public Company Earnings Press Releases

12
 According to the knowledge transfer literature (see Pfeffer and Sutton 2103) learning by

exemplar with reflections about why key activities are undertaken and choices are made is one of

the best means of acquiring tacit, and reinforcing explicit, knowledge about a subject. Hence, we

examine how to prepare for and execute an interview-based study on a financial accounting topic

that we actually carried out the creation of EPR within publicly traded companies. We first

provide the rationale for why we thought a field study was needed in this area. We then discuss

our specific approach to preparing for entry into the field as it related to our understanding of the

regulatory setting (e.g. accounting standards, SEC regulations, etc.) and the extant financial

reporting and related research that informed us about this topic. Third, we discuss how we

developed our interview protocol (i.e. the questions to be posed) and how we obtained access to

potential informants (i.e. interview participants). Fourth, we illustrate the analysis process and

some insights into the reporting of interview field data. In each case, we present extracts of how

the research paper based on the qualitative data would have read (see footnote 3 for explanation)

and then discuss the considerations that underlie how we conducted our research.

Motivation for our study

We documented our decision to enter the field to study the earning press release creation

process as follows:

Annual and quarterly earnings press releases (EPRs) that accompany the management
discussion and analysis (MD&A) and the financial statements have increased in
importance, length and level of content in recent years. Indeed, as Henry (2008) states,
somewhat tautologically, [f]irms have demonstrated the importance of the press release
by increasing its length (366). Thus, the release of the EPR tends to be a much
anticipated quarterly event for most companies. While the EPR is considerably less
extensive than the ever-growing regulated accompanying underlying documents (MD&A
and financial statements in Canada), researchers have speculated that the EPR, which is
largely unregulated, has been designed by managers to focus the attention of the
investment community more to managements message (Elliott 2006). In the United States,

13
 quasi-regulatory guidelines outline, mostly at the stock exchange level, what should be
included and who should be involved in the development of the EPR.
Recent research in the U.S. context has demonstrated that corporate EPR content is value
relevant, even after controlling for the information content of financial statements (Davis,
Piger, and Sedor 2012). Researchers have also recently shown that the language employed
in the press release (i.e. optimistic or pessimistic), according to text analysis software,
results in a significant incremental market response to earnings announcements, after
controlling for other known factors affecting market responses to earnings information
(see Li 2010 for a summary of this literature).
There has been little research to date, however, that examines how firms create the
quarterly or annual EPR. Davis and Tama-Sweet (2012) document that the nature of the
language employed in the EPRs is much more optimistic than that in the MD&A and
attribute this difference to managers strategic reporting of the same information
differentially across communication outlets. We focus on the creation of EPRs as prior
research has documented that the market tends to process information in EPRs more
efficiently than in the more regulated disclosures (e.g., Levi 2008). Hence, through the in-
depth examination of companies EPR creation processes, we gain a better understanding
of the actual processes employed including who is involved in the EPR creation process,
the relative prominence of accounting information within the EPR and the considerations
that affect the content and structure of an EPR.
Hence, our initial motivation to enter the field was based on the apparent reliance of market

participants on this unregulated disclosure and from insights in academic literature that are

suggestive of deliberate language differences between the more regulated MD&A and the less

regulated EPR. Given that extant research had focused on the end product, the press release, we

thought that deeper understanding of the process issues involved might be informative about that

product.

Specific preparation for the study of earnings press releases

In general, there are two broad areas that a financial reporting researcher should consider

in preparation for entering the field to study a topic: 1) the regulatory environment, including

securities regulators, accounting standard setters and others (e.g. professional bodies) who have

influence on the institutional context related to the topic; and 2) what the extant analytical,

14
archival, and experimental research in financial accounting and related topic areas have to say

about the topic.

To ensure our understanding of the institutional setting, we carefully examined the

various securities regulators websites including related regulations (the SEC in the USA and the

OSC as representative of the CSA in Canada); the major stock exchanges websites (NYSE, ASE,

NASDAQ and TSX), especially their listing requirements, as well as their ongoing disclosure

requirements. We summarized what we found as follows and as is reported in Table 3 Panel A.

In the U.S. the regulations that have been published with respect to press releases and pro-
forma disclosures include the content, the composition of the committee that oversees and
writes the document and the timing of its release and come from a variety of different
sources, including, but not limited to, the Securities Exchange Commission (SEC), the New
York Stock Exchange (NYSE) and the American Exchange (AMEX). The regulations
caution against unwarranted promotional disclosure, inappropriate wording, overly
optimistic forecasts and states that any projections should be based on sound, qualified,
conservative and factual information. It is also highlights the notion of the release being
written in plain English something that is comprehensible to the layman. Depending
on which stock exchange the companys shares are traded in, the wording of the
regulations will vary slightly though the main concepts are the same across American
stock exchanges. Furthermore, there was ongoing interest in limiting the use of non-GAAP
measures in the press releases.
There are no regulations pertaining to EPR creation in Canada, and often the press
releases of those Canadian companies that are not registered with the SEC contains a do
not release in the United States disclaimer on the top of the release. The content in
Canada is regulated under the National Instrument 51-102 produced by the provincial
securities commissions. It contains rules as to what should be discussed and presented
within the press release provides that the only acceptable method of full dissemination of a
news release in Canada is through Canada Newswire.
We also examined the news media for articles about EPRs both the issues surrounding

their creation in general as well as the specific press releases of the companies that we

approached to include in our study. This research lead us to discover that the professional

investor relations bodies in each country (the National Investor Relations Association (NIRA) in

the USA and the Canadian Investor Relations Institute (CIRI)) produced best practice guidance

15
for earnings press releases.11 Table 3 Panel B provides a summary of what we found about best

normative practices in EPR.

There is relatively little need to examine accounting standards in this study, as EPR

content is not covered by generally accepted accounting standards either in the USA or

internationally. Further, there were no audit standards that might have indirectly affected the

EPR creation process.12 Hence, while we did our due diligence in the area of accounting and

auditing standards, for this particular topic there were no standards relevant to our topic.

After examining regulations and standards, we investigated research on EPRs in financial

accounting and related areas. Utilizing the full text search capacity of bibliographic data bases

(e.g. ABI Info Global) we discovered three primary areas of research interest around EPRs. The

first, older literature surrounding press releases focused on them being used to determine the

timing of the public release of potentially value relevant information so as to increase the

accuracy of event determination in financial reporting event studies (e.g., Hoskins, Hughes and

Ricks 1986). The second research area concentrated on the use of non-GAAP measures in the

EPR (e.g., Schrand and Walther 2000). However, that research focused on the difference

between the non-GAAP and GAAP performance measures the EPR was mainly noted as a

venue for non-GAAP measures release albeit later research emphasized where in the EPR the

non-GAAP performance measures were placed (e.g. Bowen et al. 2005). The most recent

research area focuses on how the wording (or tone) used in the press releases conveyed

11
Five of the six companies were reporters under both USA SEC and Canadian CSA standards, while one firm was
only listed to trade in Canada.
12
At the early stages of our research, we thought that audit standard setters discussions about expanding the
requirements for auditors to review Other information beyond the financial statements might affect our study.
However, in the end the revised standard (ISA 720) was limited to annual report type documents and explicitly
excluded earnings press releases from the scope of the standard.

16
information to the market, beyond what information is literally conveyed. We summarized this

stream of financial accounting research on EPRs as follows:

Henry (2008) examines the tone within EPRs and highlights the various regulations
surrounding their release, including plain English requirements and non-GAAP disclosure
requirements. Henry found that a longer press release diminishes the positive market
impact of unexpected earnings (p. 394) and that a more numerically intensive press
release diminishes the positive market impact of unexpected earnings (p. 395). . . . . .Most
prior research, however, examined the usefulness of the disclosure information through the
market reactions to the EPRs or the reaction of the market to the timing of EPRs
(Bhattacharya, Black, Christensen, and Mergenthaler 2004; Bryan and Lilien 2004; Elliott
2006). See Li (2010) for a comprehensive review of this literature.
Increasingly, the content and nature of the wording of the EPR is being studied with
respect to how it affects markets (e.g. Davis, Piger and Sedor 2012). . . . . . Archival
researchers (e.g. Davis, Piger and Sedor 2012) using text analysis software have found
that the tone of the press release (i.e. pessimistic versus optimistic) affects markets to a
greater extent even after controlling for other regulated documents disclosures (i.e.
MD&A, financial statements). . . . .
Focusing on the content of the documents, Davis and Tama-Sweet (2012), employ text
analysis software and find that relatively more optimistic and less pessimistic language is
found in the EPR versus the MD&A of a large sample of firms. The researchers attribute
this latter finding to management strategic intent and find that the language differences are
greatest under conditions where management has greater incentives to emphasize the
positive results (e.g., where they barely met consensus analyst forecasts). However, this
also implies that large public companies have a process that deliberately leads to the
creation of such differences. . . . .
Based on this literature, we conclude the following about the assumptions that extant research

made about the EPR creation:

Underlying the reviewed research in this area, there is a strong assumption, either
explicitly or implicitly, that most managers are behaving strategically and/or
opportunistically when creating and issuing press releases. Some of the research explicitly
assumes that managers deliberately mislead investors by choosing to emphasize the
earnings metric that portrays the more favourable firm performance (Bowen et al. 2005;
Black and Christensen 2009; Black et al. 2012) and that management has incentives to
meet or beat earnings benchmarks and manipulate pro forma statements to do this (Brown
et al. 2012).
We also found evidence that the EPR, despite its problems, is a highly important
communication from management to investors (Files, Swanson and Tse 2009; Davis et al.,
2012). Research has found that the wording of EPRs is more optimistic and less pessimistic

17
 than MD&As (Osma and Guillamon-Saorin 2011). Further research also shows that
managers as if they are aware of the EPR importance to investors as they seem to
strategically place information in EPRs (placed in headline, first couple paragraphs, at the
end) depending on how much attention they would like to draw to the information (Bowen
et al. 2005).
Thus, our review of the regulatory requirements and research literature makes it clear that

there is an underlying tension to be explored. The regulatory/normative emphasis is on

companies providing accurate and complete information to enable investors to assess the facts

in question (see Table 3) in EPRs, whereas academic researchers view is that managers are

acting in a strategic and/or opportunistic manner when creating EPRs. This tension adds to our

curiosity based motivation documented in the previous section as to why we should go into the

field to study the creation of EPRs.

Developing the interview protocol

The description of the interview protocol (the list of and approach to asking the questions in

the interview) development process for our EPR study read as follows:

We developed an initial interview protocol, which we reviewed with colleagues and then
pre-tested with contacts at CIRI as well as an investor relations professional. As part of the
pre-testing we discussed with the interviewees the purpose of or our research and our data
gathering goals. We then adapted the interview protocol, based on the feedback received.
The interviews were conducted in person by one or more of the authors on the paper
except one interview that was done by phone at the request of the interviewee. See
Appendix B for interview guide. This guide was slightly customized depending on the role
of the interviewee (e.g. CFO versus auditor). The interviews were then transcribed and
returned to the interviewee for approval.
This short description embeds a large amount of assumed tacit knowledge about how to develop

an interview protocol. We began to develop the protocol by, as noted above, immersing

ourselves in the regulations surrounding press releases, the academic literature on EPRs as well

as reading a large number of EPRs to understand the language used and messages being

18
conveyed. This immersion facilitated our understanding of the purpose, timing, content, and

messaging of EPRs.

The interview protocols reason for existing is to aid the researcher to elicit responses to

questions that enable the researcher to understand what, how, when, and to a lesser extent, why

the informants do what they do as part of their normal work. However, it is the interview-based

researchers duty to develop questions that will elicit raw qualitative data from the informant.

The researcher then analyzes the qualitative data and interprets it so as to be able to answer the

research questions posed. Thus, the interview-based researcher has the same role as an archival

or experimental researcher who collects data then analyzes and interprets the resultant

quantitative data analysis. Researchers carrying out interview-based research to find answers to

the question what do managers say they do still have full responsibility for the data collection,

analysis, and interpretation similar to researchers employing other methods. The interview-based

researcher does not simply a reporter who merely collects managements interpretations and

recalls about what managers do in general as they carry out a financial reporting activity. That

is, addressing the first myth about field research, the researcher does not just go out and talk to

people and then summarize what they say but rather, in order to conduct high quality

interview based research the researchers must employ rigorous research methods to the data.

The interview protocol we developed for our earnings press release study (see Appendix

B) is a compromise between a semi-structured interview approach (see Appendix B - Questions

1 and 2) and a highly structured interview protocol (see for example Appendix B - Question 3)

(see Bernard 2002 Chapters 9-11). A semi-structured approach allows the researcher to focus on

a topic, but also allows the interview to proceed naturally along the lines that the informant

wants to follow. The semi-structured aspect of the protocol, however, always brings the

19
informant back to the topic of interest. In the alternative, a structured interview is more like an

in-person version of a mail or internet survey.13 The researcher must rigidly follow a pre-

determined order of questions and not deviate from that order (e.g., see Question 3 with its very

directive approach) when interacting with the informant.14 We chose a combination of semi-

structured and structured interview questions to ensure that we comprehensively collected our

qualitative data. However, note that the main focus of the protocol and data gathering is on the

semi-structured portion of the protocol as those questions allow us to better peer into the minds

of managers (Libby, Bloomfield and Nelson 2002).

We embedded in the interview protocol three reminders ourselves to follow the norms of

good interviews while carrying out the actual interview. These three reminders have broader

implications for the conducting interview-based field research and warrant additional discussion.

First, a good interview always starts with obtaining informed consent from the informant

(usually there is an appropriate form that is approved by a university ethics board along with

their approval of the entire interview-based research study plan). During and after this signing

off, the goal of the researcher is to attempt to build rapport with the informant (see Script in

Appendix B). Common ways of seeking to develop such rapport include discussing

commonalities in your background (e.g. professional designation, prior work experience,

13
There is a third interview type called an unstructured interview where the researcher explores general themes of
concern about a topic with an informant, with little structure being prepared in advance other than the topic. While
this can be used in positivist research, it is an approach that is mainly associated with the interpretive methodology
based research where broad global concerns motivate the researcher to enter the field (see Malsch and Salterio for
a discussion of this).
14
In many ways, if one is going to use a structured interview approach, the researcher should consider if there is any
way to change the research method to that of a survey questionnaire given that the presence of the researcher asking
the questions is almost superfluous to carrying out the structured interview. The main advantages over the survey
questionnaire is that the researcher is certain as to who is answering the questions (i.e. responding to the survey was
not delegated to a more junior persons) and can readily determine the amount of thoroughness of thought that the
informant is giving each question. On occasion, in a structured interview, the interviewer may be permitted to
clarify questions for the informant, which is often cited as an added benefit from the interviewer being there in
person.

20
graduating from/attending the same university), referring to someone that the informant knows

that provides assurance to the informant that you are an ethical researcher (e.g. discuss how you

know the key contact who arranged this meeting and how long they have known you), and if

applicable, your promise to return the interview transcript for them to review/correct and to

provide them with a copy of the paper prior to its finalization for their comments.

Second, assure the informant that you are interested in learning about their world from

their point of view and that you will not discuss what they tell you with others in the company.

They are the experts in this area and you are learning from them. Further, you should attempt to

get the informant to speak freely by asking a broad open ended question early in the interview

that allows the informant to tell a story about the issue that you seek to learn about. For

example, our first interview question/item for discussion was 1. a. Please describe the process

that culminates in the quarterly or annual earnings press release, whichever is more recent

in your memory. Several important points are implicit in the construction of this initial

question:

a) The focus on recent or salient events that the informant took part in. Both recent and
salient events are more likely to be readily recalled from episodic memory (Craik and
Tulving 1975) and be more accurately recalled than events that are in the distant past
and/or that made little impression at the time.

b) Process stories around a single activity are more easily recalled than asking the
informant to recall things that were common or uncommon across multiple events or
activities. Our memories are not well suited for these latter types of searches and
hence asking questions in that manner is likely to result in highly unreliable data
(Jacoby and Brooks 1984).

c) Encourage the informant to talk at length so that the interview does not become
bogged down discussing the specific issues that your preparation has lead you to
expect to be covered. Mind you, as illustrated by the list of items after Appendix Bs
question 1. a., the researcher needs to keep track of the specific issues that your
preparation suggests might be discussed by the informant so that eventually you can

21
 ask them about the items they did not mention. However, if the researcher starts by
interrogating the informant about each item the researcher expects them to consider
important, it is highly likely that the informant will only respond to those items even
if there are other factors that might have emerged had the researcher allowed the
informant to tell their story.

d) Note the caution in the protocol after question 1. a. that states After several
prompts and receiving no additional detail, use these specific prompts to fill in
details where necessary. In other words, do not assume that because the informant
has not mentioned an item that your prior research suggests is important or may affect
the informants activities, that it is not important. That item might have been
considered too obvious by the informant to mention (e.g., the practice that the CEO
has the final edit of an earnings press release and can veto any part of a draft he/she
does not want to see in it). Or there might be something unique about this specific
incident that the informant is recalling that makes that item unimportant in this
context but would have been important in a different context.

Note that only in a structured interview approach near the end of the interview, do we move

away from process and/or factually oriented questions towards the informants opinions about

what they are doing (See Appendix B - Question 3 item d). In other words, we avoid asking the

informant to interpret the data for us until after we have collected the vast majority of our

interview data.

Third, if as a researcher you cannot resist asking in general questions as part of your

interview protocol, please only do so only after eliciting a recent or salient specific example of

what you are studying. As noted above, the human memory for daily events at work is generally

not set up to encode and discover empirical regularities in what is happening (Jacoby and Brooks

1984). Note that we do not employ this in general type of question in our interview protocol

except for our very broad final question 4: Is there anything else youd like to tell us about the

press release process?

Fourth, while it is not always possible, having two interviewers can make the process go

smoothly. One interviewer can concentrate on the posing of initial questions, keeping appropriate

22
eye contact with the informant and otherwise facilitating the flow of the meeting. The second

interviewer can make notes as well as keep track of which additional prompt items that the

informant cited during their initial response (i.e. the items below the general questions as seen in

Questions 1 and 2 in Appendix B). The second interviewer can do the follow-up questions

where the first interviewer then takes notes. Field notes are an invaluable supplement to audio

recordings (and a substitute if the recording becomes corrupted) as they can be used to report on

mood, tension in responses and other qualitative aspects of the interview that might not be picked

up by audio.

Seeking informants for the study

The formal description of the interview process that describes the set of firms and

informants in our EPR study reads as follows:

In this study, data was collected from three main sources: (i) semi-structured interviews,
(ii) online press release archives of both the firms themselves and the dissemination agency
(e.g., the CNW group) and (iii) the on-line SEDAR system.15
The individuals we interviewed were all members of their companies disclosure
committees. The disclosure committees, though different across companies, are typically
comprised of an individual or two from investor relations, the chief financial officer, legal
counsel and business unit heads. Table 4 Panel A provides demographics for the
companies examined, Table 4 Panel B provides the job titles and pseudonyms for the
individuals interviewed and Table 4 Panel C provides details about each firms disclosure
committees.
Again, this very short quote embodies a large amount of both explicit and tacit knowledge about

carrying out the study. Our research was designed so as to obtain at least three different members

from each firms disclosure committee so that we could triangulate the data across the informants

(see reference article Jonsen and Jehn (2009) about strengthening data validity via triangulation

15
The SEDAR system is the Canadian equivalent of the USA SECs Edgar system. It is described as the official
site that provides access to most public securities documents and information filed by public companies and
investment funds with the Canadian Securities Administrators (CSA) in the SEDAR filing system. See
http://www.sedar.com/homepage_en.htm accessed on February 15, 2013.

23
of different peoples interviews and over multiple data sources).16 Further, to aid in developing

common ground and understanding of the company, we gathered as much publically available

information about the firm as we could. This background research ensured we were fully

prepared (and were seen by the informant as prepared) to conduct the interview so that the

informant did not have to spend valuable interview time explaining publically available

background about his/her company. Further, this archival research aided with our analysis and

interpretation of the qualitative data gathered in the interview.

Securing the appropriate participants for an interview-based study is key to the success

and contribution of the study. For the EPR study, we started by considering the set of contacts

we had developed over the years of carrying out fieldwork in negotiation research from the CFO

perspective (see Gibbins, McCracken, and Salterio 2007 and McCracken, Salterio, and Gibbins

2008). We then reached out to others within the authors professional and social networks.

Among those that we approached to aid in identifying potential contacts were:

Deans and with their permission members of the School and University Advisory Boards;
Faculty that were known to have connections with the C-suite in the various firms they
did consulting work with;
Our schools alumni relations departments, especially those who were responsible for
classes from the 1950s and 1960s and those with relationships with executive MBA
graduates;
Our schools fundraising departments, especially those who had responsibility for
fundraising with public companies; and
Our own social networks dating back to our undergraduate student days.

16
Recall from footnote 3 that the study was not completed as designed due to the shock of the global fiscal crisis of
2008. Hence, we did not obtain the requisite three informants from each firm that agreed to participate nor did we
obtain the remaining four of five planned Canadian only listed firms. Part of the research was to understand
differences in EPR creation in relatively more related USA SEC environment (hence our five firms registered with
the SEC) versus the less regulated Canadian environment.

24
We always asked for permission to mention the name of the person who referred us to the

contact.17 We followed what some call the snowball technique (Miles and Huberman 1994)

where we would ask our initial informants in an organization if they would arrange for

interviews with other members of the organizations disclosure committee. We also had some

success with asking informants to refer us to other organizations and providing the introduction

to a key contact there. Hence, as can be seen from the variety of approaches, there are multiple

ways to obtain access to potential informants to allow for opportunity for the researcher to

convince them to become research informants.

Analysing qualitative data

Attempting to describe how to analyze qualitative data in a short article is like attempting

to explain econometrics or experimental design and analysis in a few paragraphs. There are

several excellent resources suggested in Table 2, including the classic text, newly updated for

this century - Miles, Huberman, and Saldana (2014). Much of the research methods writing

about qualitative data analysis is based on the premise of long term in-depth field research of the

case study variety rather than the more focused interview-based studies that we are discussing in

this article. Hence, normally the research needs to employ only a subset of the methods in these

resources (e.g. see Lillis 1999 for a discussion of this applied to management accounting).

We described our approach to analyzing the EPR interview data as:

The data analysis undertaken adapts three principal methods proposed by Eisenhardt
(1989) and Anderson (1995). The first method of analysis involved arranging the interview
transcripts and notes into a chronological order. The transcripts and notes were
superimposed on one another and common and unique perceptions of the process both

17
One of the challenges of field research under the mandates of university ethics boards is to be able to put together
recruitment scripts that enable the researcher to adapt to a number of possible recruitment scenarios for potential
informants.

25
 within and across firms were identified. This process highlighted areas where further
investigation was required.
The second method of data analysis involved re-organizing the original transcripts and
notes by company, by position, and by question to allow for the identification of relevant
themes. Third, iteratively throughout the research analysis, the transcripts were reviewed
and reread for additional insights and findings.
Finally, we compared the interview data about what was actually done to the normative
regulatory and best practices documented in Table 3, as well as, the assumptions that were
embedded in the extant research literature about how EPRs are created.

As noted previously with respect to other methods information documented in the final research

paper, the description about how qualitative data is analyzed assumes that the reader has both

explicit and tacit knowledge about qualitative data analysis. Most researchers (e.g. Schutt 2015)

who undertake interview-based research would agree to the following as underlying qualitative

data analysis:

1. Get to know your data read and re-read it through a variety of lenses. As noted in our
data analysis description, we read the interview data chronologically by informant (as we
did not interview the informants in each organization then move onto another
organization), across informants in a given company, across the same type of informant
across companies (e.g. legal counsel), and by answer to the same question across firms
and informants.
2. Code the data identify and organize categories of relevant concepts related to the
study.
a. We chose to approach our data from the perspective of letting the data speak
that is inductively developing categories and themes about the EPR creation
process. For example, one of the themes that emerged across our six companies
was on creating a message that we described as follows
To begin the process, the lead person consults with the different business
units regarding the key events or activities for the quarter. On average,
the companies tended to identify the 10 key items for the quarter, which
would then be analyzed and reviewed to determine the key message(s) of
the EPR. For example, IR 2 described the process at his company as
starting with the financial reporting manager holding meetings with
business units and function heads to identify top issues and out of the
norm things that would need to be explained. At IR 1s company the
process of identifying issues or items important to the quarter proceeded
as follows: theres a business consultation process at the beginning of

26
 the process. So well look to the major trends. Well do financial analysis.
Well do business analysis. Well do variance analysis.
b. After that analysis was completed, we then compared what the informants had
said to the normative regulatory and best practices literature on EPR and the
assumptions about how EPRs are created in the extant research literature. For
example, related to our messaging theme, we concluded
Overall, our research finds that the EPR process is set up to ensure that
the EPR reflects the message that management wants to convey to the
investment community. This supports the inferences of archival
researchers (e.g. Davis and Tama-Sweet 2012) that managements
strategic intentions are reflected in the language of EPRs as we find that
messaging is deliberately planned and designed into all six of our
firms EPRs.
In some studies, ex ante categories may be the focus of the data coding (e.g. such as those
in our study based on the normative regulatory and best practices literature). The
researcher must make a judgment call on the specific data analysis strategies to apply,
based on their perception of the current state of knowledge about the topic (i.e. the more
that is known about the topic, the more likely that ex ante categories can be identified that
will be meaningful and complete). The researcher must always be alert when coding the
data to ensure that attention is given to what does not fit into the current coding
scheme, and this caution is even more important when starting with a set of ex ante
categories to code the data.
3. Connect the categories and concepts together show how categories and concepts
appear to influence one another. This might involve:
a. Describing categories by theme, such as similarities and differences about the
same item by informant. For example,
We heard from several of our interviewees that after the general
messaging theme is determined, senior management relies on the
disclosure committee and related staff to gather the details for the EPR
and vet the first couple of drafts. Senior management then weigh in when
the numbers and message are close to being finalized. As one interviewee
described it, after three iterations, the draft EPR goes to the president and
CEO. This did differ for what were described as more hands-on CEOs
who chose to remain heavily involved throughout the EPR drafting
process.
b. Grouping categories together so as to relate the parts to the whole process;
c. Attempting to measure the relative importance of various categories and themes
within categories (e.g. by counting the number of times a particular theme
occurs);18 and

18
The tendency to apply data counts to the exclusion of all other types qualitative reporting is often found among
novice interview-based researchers. While some count data might well be helpful in understanding relative
importance attached to concepts and categories by these informants, the interview-based researcher is not attempting

27
 d. Identifying relationships between categories (see Spradley (1979, 111) e.g. a set
of semantic relationships that can vary from strict inclusion where X is a kind
of Y to function where X is used for Y etc.)
4. Create tentative conclusions based on the analysis
5. Corroborate those tentative conclusions by:
a. Evaluating alternative explanations (e.g. based on different theoretical
perspectives),
b. Focusing on disconfirming interview evidence that contradicts the tentative
conclusions, and
c. Searching the data set carefully for negative cases of material that does not fit into
the tentative conclusions.

If unanimity is reported about conclusions in interview-based research, it is often due to a

breakdown in the interview process where the researcher has lead the informants (explicitly or

implicitly) to a conclusion that the researcher wants to reach. We document a counterexample to

this unanimity in our EPR study where, as seen in the above quote about CEO involvement with

EPRs, we reported differing perspectives among our informants.

Before concluding the data analysis section, we point out two, potentially labour

intensive, activities that have to be undertaken when dealing with qualitative data. The first is the

transcription of the interviews and/or the field notes that were created during or immediately

after the interviews so as to create the qualitative data. While there are computer voice

recognition and transcription programs that are becoming increasingly better at automatically

transcribing electronic interview data, careful review of the accuracy of such transcriptions is

required by the researchers. The requirement to check transcripts for accuracy, prior to returning

to the informant for approval (if promised and appropriate), must be done even if the interviews

are manually transcribed by the researcher, a research assistant or a transcription specialist.

to generalize to a population based on a random sample of informants. Rather, the goal is to deepen the researchers
and the readers understanding of the issue by obtaining and understanding the in-depth insights from those who
actually perform the task. Hence, endless recitation of means, median and standard deviation of count data from
interviews totally misses the point of carrying out qualitative research.

28
 The second labour intensive activity is the coding of the qualitative data that is discussed

in Step 2 in addition to the connecting the concepts coding discussed in Step 3. With a small set

of relatively focused interviews, one can carry out both steps manually. As we found in our

study, however, as the number of informants increased, the manual data coding approach that we

started with would have needed to be transitioned into computer assisted coding. Indeed, even

implementing Step 1, where we read the interview data chronologically by informant (as we did

not interview the informants in each organization then move onto another organization), across

informants in a given company, across the same type of informant across companies (e.g. legal

counsel), and by answer to the same question across firms and informants, became increasingly

difficult to do as the number of informants increased. There are a variety of well-supported

computer packages that are designed for the coding of qualitative interview data (e.g. Nvivo and

Atlas.ti are two prominent commercially supported packages along with a number of freeware

packages).

Reporting interview field data

Most interview-based researchers start from the premise that interview evidence should

focus on transmitting, to the extent possible and without overwhelming the reader with minutiae,

the richness of the phenomena as experienced by the informant (see Ahrens and Dent 1998).

Richness means providing direct quotes to support the claims of the researcher in a systematic

fashion (see examples from our EPR study in the preceding section). To avoid overwhelming the

reader with minutiae, excessively long quotes should be limited.

In some instances tabulation of qualitative data is necessary. Normally items that are

chosen for tabulation tend to be descriptive of tendencies found in the data, so considerations

29
about reliability of the data coding need to be addressed (see Armstrong, Gosling, Weinmann,

and Marteau (1997) on inter-rater reliability in qualitative research). Frequently authors

themselves are called upon to do independent readings of the interview transcripts, make their

observations and then discuss them with their co-authors until a common view is reached.

Qualitative data research reporting should not devolve into a presentation of means,

medians, and standard deviations to each tabulated question as this approach loses the richness of

the field data, typically a key motivation to go into the field in the first place. Further, as each

informant is reporting on their own experience, emphasizing central tendencies loses the

individual knowledge and experience being sought by the researcher from the informant (see the

discussion in Trotman and Trotmans (2015) study of internal audit's role in GHG emissions and

energy reporting of the trade-off between reporting central tendencies and individual

knowledge).

Examples of financial reporting studies that report interview only data are non-existent at

present in top tier accounting journals. However, there are several corporate governance

studies that provide excellent templates for how to assemble a qualitative interview-based study

report that is sensitive to the issues above. In particular, we refer to Beasley et al. 2009, Cohen et

al. 2010, Hermanson et al. 2012, and Clune et al. 2014 as studies that exhibit best practices in

reporting qualitative interview-based research. A review of these studies, plus an understanding

of the above steps, allows one to better understand the rigorous processes required to conduct

high quality, publishable interview based research in financial reporting again debunking the

first myth that interview based research is all about going out and talking.

Discussion and Conclusion

30
 As the calls for field work and interview-based research in financial reporting have

increased, the need for training on how to conduct interview-based research has risen. This paper

aims to fill this research methods gap by guiding researchers to appropriate resources to enrich

their knowledge base prior to entering the field and on how to plan, conduct and analyse data

collected in interview based research. Guided by knowledge transfer theory this enhanced

understanding of interview based research methods should lead to more valid and reliable

interview based studies in financial reporting.

Using a step-by-step knowledge transfer approach, we walk the reader through a field

study that examined the creation of EPRs, highlighting both the steps taken and important

literature and concepts needed to successfully conduct qualitative research. From motivation,

preparation for study, and development of the guide, to seeking informants, analyzing data, and

reporting your findings, the six steps highlighted in the paper outline the basic approach to all

interview-based studies, with sub-steps and processes for each step elaborated on as necessary.

By providing these steps and describing the work involved in our EPR study exemplar, we are

able to demonstrate interview based field research myth that just going out and talking to

people is not the proper way to conduct qualitative interview-based research. In addition, as a

qualitative researcher, the effort does not stop when the interviews are completed, but rather, the

data collected must be coded and analyzed, just as in archival and experimental research using

rigorous methods.

The second myth we addressed was the need for years of specialist training to do field

research. While certainly more methods training is preferred to less, in principle, just as we do

not insist our economics based or psychology based students master fully econometrics and

research design, we articulate an approach that complements acquiring book knowledge with

31
practical how to do it knowledge. Our paper demonstrates that a positivist approach to

interview based field research can be successfully learned without years of training as contended

by some in the qualitative accounting methodology research community. We provide the basics

that researchers need to know about their field, their role, and the type of preconceived notions

they have entering the field and how these affect collecting, analyzing and presenting the data

analysis.

This paper provides the how to knowledge transfer of conducting interview based

research as well as the key resources a researcher should consult when conducting qualitative

field work and interviews. We have provided an initial list of additional papers and books to

consult throughout the research process to gain the explicit knowledge needed to carry out such

research. One of the key take away messages from our paper is that interview-based qualitative

financial accounting research studies have a place in all accounting journals. Though the work to

be done can be time consuming and requires rigorous preparation and execution, the

opportunities and contributions for financial reporting researchers are boundless. The insights

gleaned by asking the how questions to those directly involved in the work can help lead to

highly insightful original research findings of similar scale to those found in auditing and

management accounting research as well as providing closer links to practitioners concerns and

interests in financial reporting research.

32
Appendix A

Financial Reporting Research Qualitative Methodology

This appendix introduces the different assumptions underlying research done in the

qualitative accounting methodological tradition and provides an introduction to the larger set of

published research related to financial accounting that has been generated by researchers in that

tradition. See Parker (2007) for a literature review that contextualizes this line of research vis a

vis approaches more familiar to archival and experimental accounting researchers.

We start by distinguishing between qualitative methods (e.g., interviews, focus groups,

observation) which aim a producing qualitative data and qualitative methodology which is

focused on the view of the world held by the researcher. Chua (1986) suggests there are three

different views of the world each having an underlying set of assumptions that informs the

way researchers view the purpose of research and impacts how the research is conducted. These

different views of the world can be labelled as positivist, interpretive, and critical schools of

thought, although the latter two are often grouped together under the overarching label of

qualitative methodology research in accounting.

Positivist researchers, like archival and experimental accounting researchers, are

characterized by the belief that reality exists independently of humans or at least can be best

studied as if it is (Burrell and Morgan, 1979). This implies that researchers should attempt to

objectively observe the world and the people in it. Positivist researchers primary concern is to

generalize via developing cause and effects based theories of some phenomena of interest and

that by studying inductively the researcher can develop causal theories (Malsch and Salterio

2015, 5). Carrying out positivist financial reporting research employing qualitative methods (e.g.

interviews) is the focus of our article.

33
 Chua (1986) describes two alternative schools of thought about the nature of the world

interpretive and critical. These qualitative methodology influenced accounting researchers

believe that social reality is individually created but made real by the interactions between those

individuals. Qualitative methodology researchers tell stories; they retell history for what people

think it is, attempt to provide explanations, and in the end understand the social world as created

by those who are in it (Ahrens and Dent 1998; Myers 2009; Berg and Lune 2012). Within

accounting research, qualitative methodology articles were first found in management

accounting (e.g., Hopwood 1983; Dent 1991; Wickramasinghe and Hopper 2005) then in

financial accounting (e.g. Ouibrahim and Scapens 1989; Carpenter and Feroz 1992) and more

recently have begun to be employed in audit research (e.g., Power 2003; Malsch and Gendron

2011).

Qualitative accounting researchers tend to be concerned with the perceived processes

within the organizations and how they affect the individuals involved or how the individuals

involved view them. They also highlight the diversity of meanings that can be attached to

accounting information, as well as allowing us to see how accounting information is used to

assign meaning (Ahrens and Chapman 2006; Myers 2009). Accounting ramifies, extends and

shapes the social (Burchell, Clubb, and Hopwood 1985, 385). The understandings that are

sought by qualitative methodology researchers highlights how accounting plays out across

different organizational backgrounds and social activities (Ahrens 2008) including how

individuals develop their meanings in these situations. Although the field reality that is

deconstructed and interpreted is always localized in a specific time and space context, it is not

disconnected from the larger global empirical and theoretical issues that sent the interpretivist

researcher to the field (Malsch and Salterio 2016).

34
 The standard method of qualitative methodology research is an in-depth and long term a

field case that includes sets of interviews, content analysis, and observations focused on one or a

few organizations. For those interested in learning more about qualitative methodology there are

a variety of useful resources (c.f. Patton 2001; Hammersley and Atkinson 2007; Berg and Lune

2012) that can be consulted. The theoretical base for much of qualitative methodology

accounting research comes from theories in sociology or philosophy including actor network

theory (e.g. Gendron and Barrett 2004; Gendron, Cooper, and Townley 2007), institutional

theory (Suddaby, Cooper, and Greenwood 2007; Shapiro and Matson 2008), and structuration

theory (Ahrens and Chapman 2002; Coad and Herbert 2009). Though these theories are

unfamiliar to most positivist accounting researchers, the use of such theories can lead to findings

or analysis that can provide insights into aspects of individuals, organizations, or society that

cannot necessarily be gleaned from positivist research.

Financial reporting research themes in recent years have included the introduction of new

standards, particularly IFRS, throughout the world (e.g. Chen et al. 2014). For example, Chen et

al. (2014) and Kwok and Sharp (2005) both examined the adoption of IFRS through interviews

while Lantto (2014) and El-Tawy and Tollington (2013) explored the change in valuation of

intangible assets and their effect on recognition and value creation. Corporate governance has

been a theme in recent qualitative accounting methodology studies. For example, Johed and

Catasus (2015) explored the institutional logic behind and surrounding annual general meetings

highlighting how the shareholders association prepares for and reacts at the annual general

meetings. Parker (2007) provides a comprehensive literature review of financial reporting

research from a corporate governance perspective. Environmental reporting has also been in

35
focus as evidenced by Haigh and Shapiros (2012) examination of carbon reporting, questioning

whether it is important to investors in their decisions surrounding environmental investing.

The other topics include the use of financial accounting and financial reporting at work

(Collier 2001; Roberts, Sanderson, Barker, and Hendry 2006; Neu 2012; ONeill, McDonald,

and Deegan 2015); the introduction of new country-specific regulatory requirements (Haigh

2006; Rutherford 2003; Hinest, McBride, Fearnley, and Brandt 2001) or new accounting systems

(Connolly and Hyndman 2006). In addition, there were articles examining the Madoff Ponzi

scheme (Stolowy, Meyer, JeanJean, and Baker 2014), education in Africa (Chung and Windsor

2012), and communication methods for financial accounting information (Christensen and

Skaerbaek 2005).

Table A1 provides a brief summary of studies from the last 15 years that have used

qualitative methodology to examine financial reporting questions. Using a variety of different

theoretical basis, examining concepts from power or knowledge, to police work or the interaction

between shareholders associations and institutional investors, each paper used a predominantly

qualitative methodology framework. Though the theory used to analyse the data in interpretive

accounting studies may be unfamiliar and confusing to a general accounting audience, we can

learn from their findings and perhaps enhance the qualitative and quantitative positivist studies

being conducted. Bushman and Smith 2001 and Cooper and Morgan 2008 provide reviews of

some of this research as it applies to financial reporting concerns.

36
Table A1

Article Financial Theoretical basis Method

Reporting topic
ONeill, S., G. McDonald, and C. Deegan. Accounting in Neo-institutional Document
2015. Lost in translation. Accounting, everyday life theory review, content
Auditing, and Accountability Journal 28 at work analysis
(2): 180-209
Johed, G., and B. Catasus. 2015. Corporate Institutional theory 21 interviews,
Institutional contradictions at and around governance observations and
the AGM. Accounting, Auditing, and 20 additional
Accountability Journal 28 (1): 102-127 conversations
Chen, L., J. Danbolt, and J. Holland. 2014. Intangible assets Grounded theory 23 interviews
Rethinking bank business models: The role (actor network
of intangibles. Accounting, Auditing, and theory)
Accountability Journal 27 (3): 563-589
Lantto, A-M. 2014. Business Involvement Accounting Community of Interviews, direct
in Accounting: A case study of IFRS standards practice observations and
adoption and the work of accountants, field work
European Accounting Review 23 (2): 335-
356.
Stolowy, H., M. Meyer, T. JeanJean, and Trustworthy Trust, creation and 11 interviews
R. Baker. 2014. The construction of a investments construction of and 114 Victim-
trustworthy investment opportunity: trust impact
Insights from the Madoff Fraud. statements
Contemporary Accounting Research.
31(2): p. 354-397
El-Tawy, N., and T. Tollington. 2013. Intangible assets Social construction 12 interviews
Some thoughts on the recognition of assets, (grounded theory)
notably in respect of intangible assets.
Accounting Forum 37 (1): 67-80.
Chung, J., and C. Windsor. 2012. Accounting in Critical accounting Participatory
Empowerment through knowledge of everyday life theory action research
accounting and related disciplines: financial
Participatory action research in an African accounting
village. Behavioral Research in Accounting education
24 (1): 161-180.
Haigh, M., and M. Shapiro. 2012. Carbon Environmental Signification 30 interviews,
reporting: does it matter? Accounting, accounting observations, and
Auditing, and Accountability Journal 25 content analysis
(1): 105-125
Neu, D. 2012. Accounting and Accounting in Accounting in 60 interviews
undocumented work. Contemporary everyday life action actor
Accounting Research 29 (1): 13-37. at work network theory
Mir, M., and A. Rahaman. 2011. In pursuit Environmental Stakeholder theory 27 interviews,
of environmental excellence. Accounting, accounting document
Auditing, and Accountability Journal 24 analysis and
(7): 848-878 observations

37
Parker, L. 2007. Financial and external Corporate Social 12 interviews
reporting research: The broadening governance constructionist and document
corporate governance challenge. analysis
Accounting and Business Research 37 (1): (literature
39-54. review)
Connolly, C., and N. Hyndman. 2006. Accrual New public 15 interviews
Actual implementation of accrual accounting management
accounting. Accounting, Auditing, and
Accountability Journal 19 (2): 272-290.
Haigh, M. 2006. Managed investments, Reporting Agency theory 11 interviews
managed disclosures: financial services standards and content
reform in practice. Accounting, Auditing, analysis
and Accountability Journal 19 (2): 186-
204.
Neu, D. 2006. Accounting for public space. Accounting in Institutional Archival,
Accounting, Organizations and Society 31 everyday life sociology interviews, and
(4/5): 391-414. focus groups
Roberts, J., P. Sanderson, R. Barker, and J. Investor Foucaults power Interviews, and
Hendry. 2006. In the mirror of the market. Relations and and knowledge direct
Accounting, Organizations and Society 31: Finance observations
277-294. Directors
Chee Chiu Kwok, W., and D. Sharp. 2005. Accounting Power 30 interviews
Power and international accounting standards and document
standard setting. Accounting, Auditing, and review
Accountability Journal 18 (1): 74-99.
Christensen, M., and P. Skaerbaek. 2005. Communication Actor network 10 interviews
Framing and overflowing of public sector theory
accountability innovations. Accounting, Framing
Auditing, and Accountability Journal 20
(1): 101-132.
Holland, J. 2005. A grounded theory of Corporate Grounded theory 25 interviews
corporate disclosure. Accounting and governance and document
Business Research 35 (3): 249-267. analysis
Lye, J., H. Perera, and A. Rahman. 2005. Reporting Grounded theory 13 interviews
The evolution of accruals-based Crown standards
(government) financial statements in New
Zealand. Accounting, Auditing, and
Accountability Journal 18 (6): 784-815.
Rutherford, B. 2003. The social Reporting Social Content analysis
construction of financial statement standards constructionist
elements under Private Finance Initiative
schemes. Accounting, Auditing, and
Accountability Journal 16 (3): 372-396.
Collier, P. 2001. Valuing intellectual Accounting in Knowledge sharing Participant
capacity in the police. Accounting, everyday life observation,
Auditing, and Accountability Journal 14 at work interviews and
(4): 437-455. document
analysis
Hinest, T., K. McBride, S. Fearnley, and R. Reporting Institutional theory 16 interviews
Brandt. 2001. Were off to see the wizard: standards

38
An evaluation of directors and auditors
experiences with the Financial Reporting
Review Panel. Accounting, Auditing, and
Accountability Journal 14 (1): 53-84.

39
Appendix B

Interview protocol for company managers EPR study

A. Script:

Thank you very much for your time. The information you provide will help us understand your
role better and improve our research and teaching accordingly.

We are interested in your involvement with press releases containing financial information.
There has been some research on press releases themselves, but little on the process itself.

We are told by others in your company that you have significant involvement in the financial
press release process for your company. That is why we are talking to you.

B. Questions

1. Earnings press releases

a. Please describe the process that culminates in the quarterly or annual earnings press
release, whichever is more recent in your memory.

{After several prompts and receiving no additional detail, use these specific prompts
to fill in details where necessary.

o Who wrote it?

o How did you characterize the language in this press release?
o Who reviewed and approved it?
o How long did the process take?
o Did the process require a positive approval (i.e. a meeting, e-mail or phone call),
or an implied approval after a certain period of time?
o Was it reviewed?
o If reviewed, what other information did you provide reviewers with?
o What determined whether this press release was shown to the audit committee?
o What determined whether this press release was shown to the auditor?
o What determined when this press release was shown to auditor/AC?

Overall questions:
o Are you comfortable with the process and timing involved with generating and
releasing earnings press releases?
o Have you ever been required by the review process to make any changes to an
earnings press release? If so, please describe the circumstances and how it was
resolved.

b. Are there any differences for the quarterly or annual earnings press release (whichever
was not talked about originally).

40
2. Focus on other press releases that contain financial information other than earnings
press releases.

Please describe the process that culminates in a recent press release being released that
contains financial information other than an earnings press release.

{This list of prompts is to be used only after several prompts to get additional detail and
no additional detail is being provided Use the following prompts for elaboration where
the issue was not covered.

o Who wrote it?

o How did you characterize the language in this press release?
o Who reviewed and approved it?
o How long did the process take?
o Did the process require a positive approval (i.e. a meeting, e-mail or phone call),
or an implied approval after a certain period of time?
o Was it reviewed?
o If reviewed, what other information did you provide reviewers with?
o What determined whether this press release was shown to the audit committee?
o What determined whether this press release was shown to the auditor?
o What determined when this press release was shown to auditor/AC?}

3. Overall Questions

a. Types of press releases:

o Please describe the nature of the press releases youve been responsible for.
o What are the most common topics contained in your companys press releases
that contain financial information?
o What rules determine who can initiate a press release that has material financial
information in it?
o Who determines that a press release should be issued?
o Who determines what category of newswire it is released under?
o What rules determine who must review and approve it?
o Who is involved (titles of the individuals) in creating the press release?
o Are there guidelines or policies for what should be contained in the press release?
If so, please describe. Could you provide a copy of the policy?

b. Your specific involvement in the process.

o When you are preparing or overseeing such a press release, what sources of
information do you use?
o How familiar are you with the topic of each press release?
o Does the press release normally discuss something youve been involved with?
o Have you ever prepared or overseen a press release on a subject about which you
were unfamiliar? If so, please describe the circumstances and how you
proceeded.

41
 c. The review process.
Please describe the review process.
o Who is involved (titles of the individuals) in reviewing and/or approving them?
o What other information is provided to reviewers (i.e. financial statements,
contracts, etc.)?
o Has a reviewer of a press release ever requested additional information? If so,
what was it?
o Has a reviewer ever required that a change be made to the press release? If so,
please describe the circumstances and how the issue was resolved.
o How long does the process take?
o Does the process require a positive approval (i.e. a meeting, e-mail or phone call),
or an implied approval after a certain period of time?

d. Your opinion on the review process.

o Overall, do you think the approval for press releases with financial information
other than financial statements is useful? Why or why not? To whom is it most
useful and why?
o How do you characterize the language in press releases containing anticipated
future financial performance? Please explain. Can you think of an example?
Please describe.
o Do you think the individuals involved in the review process are appropriate?
Why?

4. Is there anything else youd like to tell us about the press release process?

42
Table 1
Recent Field Studies in Financial Reporting*
Article
Graham, J. R., Harvey, C. R.,
and Rajgopal, S. 2005. The
economic implications of
corporate financial reporting.
Journal of Accounting and
Economics, 40 (1-3), 3-73.
Graham, J.R., Hanlon, M. and
Shevlin, T. 2011. Real Effects
of Accounting Rules: Evidence
from Multinational Firms
Investment Location and Profit
Repatriation Decisions. Journal
of Accounting Research. 49 (1)
137-185
Dichev, I., Graham, J.R.,
Harvey, C.R. and Rajgopal, S.
2013, Earnings Quality:
Evidence from the Field,
Journal of Accounting and
Economics 56, 1-33.
Graham, J. R., Hanlon, M.,
Methods
Survey
401 Financial Executives,
mainly CFOs
via internet and in person
paper surveys
10.4% response rate
12 questions, 5 pages long
595 Tax Executives
64 questions (12 pages long)
26.5% response rate
mainly online but some paper
169 Financial Executives
mainly Chief Financial
Officers
via internet
5.4% response rate
10 questions
595 Corporate Tax Executive
Interviews
20 Chief Financial Officers
one-on-one in person or
via telephone
cross section - different
industries, analyst
coverage and market
capitalization
40-90 minutes questions
similar to survey
12 Chief Financial Officers
and 2 accounting standard
setters
one-on-one via telephone
cross section - different
industries, analyst
coverage and market
capitalization
most were pre-survey
interviews to develop
survey
a few post-survey to
clarify survey findings
43
Shevlin, T.J. and Shroff, N.
2014. Incentives for Tax
Planning and Avoidance:
Evidence from the Field, The
Accounting Review 89, 991-
1023.
Jong, A., Mertens G., Poel, M.
and Dijk, R. 2014. How does
earnings management influence
investors perceptions of firm
value? Survey evidence from
financial analysts. Review of
Accounting Studies. 19 (2), 606-
627.
Soltes. E. 2014. Private
Interaction Between Firm
Management and Sell-Side
Analysts. Journal of Accounting
Research. 52 (1), 245-272
via internet
64 questions, 12 pages long
26.5% response rate
306 Financial Analysts (had to 21 Financial Analysts
follow at least one firm) used to clarify survey
48% response rate results
survey questions similar to interviews lasted nearly 7
Graham et al. 2005 hours
Data
set of private meeting records
from the sample firm and
data from public databases
executives at a large
capitalization, NYSE-traded
firm agreed to maintain
records of their private
interactions with sell-side
analysts
75 private interactions

Brazel, J.F., Jones, K.L., 194 Experienced, Non-

Thayer, J. and Warne, R.C. professional investors
2015. Understanding Investor online survey
Perceptions of Financial 16.5% response rate
Statement Fraud and Their Use
descriptive data
of Red Flags: Evidence from the
Field. Review of Accounting
Studies. 20, 1373-1406.

Brown, L. D., Call, A. C., 365 Sell-Side Analysts (with 18 analysts

Clement, M.B. and N. Y. Sharp,
2015. Inside the Black Box of
Sell-side Analysts. Journal of
Accounting Research. 53 ( 1), 1-
47.
Investext report)
two versions of survey
Earnings Forecast version
(EF) and Stock
Recommendation version
(SR)
5 common questions, 6
follow-up interviews from
the 82 analysts that
provided phone numbers
in survey
average 30 minutes
semi-structured

44
 twin questions (either ask
EF or SR), 3 unique question
for EF or SR 23 different
questions in total, but 14 per
survey
used Qualtrics to deliver
survey
10.9% response rate
donate $10,000 * response
rate to charity

Yoo, C. Y. and Pae, J. 2016. Do **Archival study: US firms 12 Sell-Side Analysts

Analysts Strategically Employ with analysts forecasts of to complement the
Cash earnings and cash flows and archival analyses
Flow Forecast Revisions to market reaction to revisions of 40-75 minutes
Offset Negative those forecasts
Earnings Forecast Revisions? semi-structured
European Accounting Review.
Forthcoming.

* See Appendix A for financial reporting field studies that take an interpretive approach to the
research.

45
Table 2

Qualitative Interview Methods Resources

Overview of field research
Yin, R. K. 2014. Chapter 2 Designing case studies. Case Study Research: Design and Methods
5th Edition. Thousand Oaks, CA: Sage Publications.
Cooper, D. J., and W. Morgan. 2008. Case study research in accounting. Accounting Horizons 22
(2): 159-178.
Eisenhardt, K. 1989. Building theories from case study research. Academy of Management
Review 14 (4): 532-550.
Eisenhardt, K., and M. E. Graebner. 2007. Theory building from cases: Opportunities and
Challenges. Academy of Management Journal 50 (1): 25-32.
Glaser, B. G., and A. L. Straus. 2009. Discovery of Grounded Theory: Strategies for Qualitative
Research. Piscataway, NJ: Transaction Publisher.
Lillis, A., and J. Mundy. 2005. Cross-sectional field studies in Management Accounting
Research Closing the Gaps between Surveys and Case Studies. Journal of Management
Accounting Research 17 (1): 119-141.
Smith, M. 2011. Chapter 9 Fieldwork Research Methods in Accounting 2nd ed. London UK:
Sage Publications.
Young, M. S. 1999. Field Research Methods in Management Accounting. Accounting Horizons
13 (1): 76-84.

Planning and doing interview-based research

Yin, R. K. 2014. Chapter 3 Conducting Case Studies: Preparing for Data Collection Case
Study Research: Design and Methods 5th Edition. Thousand Oaks, CA: Sage Publications.
Yin, R. K. 2014. Chapter 4 Conducting Case Studies: Collecting the Evidence Case Study
Research: Design and Methods 5th Edition. Newbury Park, CA: Sage Publications.
Bernard, H.R. 2002. Chapter 9 Interviewing: Unstructured and Semistructured Research
Methods in Anthropology 3rd edition. Walnut Creek, CA: Altamira Press.
Baxter, J., and W. F. Chua. 1998. Doing field research: practice and meta-theory in counterpoint.
Journal of Management Accounting Research 10: 69-87.
Analysis of Interview Data
Yin, R. K. 2014. Chapter 5 Analyzing Case Study Evidence. Case Study Research: Design and
Methods 5th Edition. Thousand Oaks, CA: Sage Publications.
Armstrong, D., A. Gosling, J. Weinman, and T. Marteau. 1997. The paper of inter-rater
reliability in qualitative research: An empirical study. Sociology 31 (3): 507-606.

46
Jonsen, K., and K. A. Jehn. 2009. Using triangulation to validate themes in qualitative studies.
Qualitative Research in Organizations and Management: An International Journal 4 (2): 123-
150.
Lillis, A. 1999. A framework for the analysis of interview data from multiple filed research sites.
Accounting and Finance 29 (1): 79-105.
Miles, M. B., A. M. Huberman and J. Saldana. 2014. Qualitative Data Analysis: A Methods
Sourcebook. Thousand Oaks, CA: SAGE Publications, Inc.
Morse, J. M. 1995. The significance of saturation. Qualitative Health Research 5 (2): 147-149.\
Writing up interview research
Yin, R. K. 2014. Chapter 6 Reporting Case Studies. Case Study Research: Design and
Methods 5th Edition. Thousand Oaks, CA: Sage Publications.
Evaluation of strength of interview methods used
Atkinson, A. A. and W. Shaffir. 1998. Standards for Field Research in Management Accounting.
Journal of Management Accounting Research 10:41-68.
Dub, L., and G. Par. 2003. Rigor in Information Systems Positivist Case Research: Current
Practices, Trends and Recommendations. MIS Quarterly 27(4): 597-635.
Malsch, B. and S. E. Salterio. 2016. Doing Good Field Research: Assessing the Quality of Audit
Field Research. Auditing: A Journal of Practice and Theory 35 (1).

47
Table 3
Regulatory Requirements and recommended best practices in the United States and Canada
Panel A: Regulatory requirements
SEC Policy Regulation FD
What must be No general, affirmative duty to
disclosed? disclosure material information
under federal securities law (non-
public information)
What are the Disclosures must be accurate
nature of the and complete so as not to
disclosures? mislead
i.e. the Must contain sufficient
characteristics information to enable investors
of good to assess the facts in question
disclosures properly
Requires the use of plain
English
Should be short, factual and
confined only to disclosures that
are mandatory or otherwise in
the companys business
interests.
Contain cautionary language
that takes full advantage of the
statutory safe harbor for
forward-looking statements
Companies should not disclose
information to favored analysts
or institutional investors before
making the information public
Disclosure Best practices guidelines but no
policies requirements. See NIRI Appendix
X1.*
*Appendix X1 and X2 are not included in this article but we prepared them as part of our study
so as to be able to provide readers and reviewers with more extensive information about this little
known set of best practice guidelines.
CSA Policy 51-201
All material changes under a
continuous disclosure regime
Announcements of material
changes should be factual and
balanced.
Unfavourable news must be
disclosed just as promptly and
completely as favourable news.
Companies that disclose positive
news but withhold negative
news could find their disclosure
practices subject to scrutiny by
securities regulators.
A companys press release
should contain enough detail to
enable the media and investors
to understand the substance and
importance of the change it is
disclosing.
Avoid including unnecessary
details, exaggerated reports or
promotional commentary.
Include forward looking
statement
Best practices guidelines but no
requirements. See Appendix X2.*
48
Panel B: Implementation guidance
Regulation/Guideline
Content and preparation
Disclosure committee
compilation
Scope definition
Timing
Accounting rules
Safe Harbour
Approval requirements
Dissemination requirements
US guidance Canadian guidance
(NIRI 2007 as described in (CIRI 2006)
Trautmann and Hamilton
2007)
Must be accurate, complete, Strive for timeliness, quality,
clear and concise and should consistency and balance
include adequate cautionary
language
Use EPRs as a framework for
the more detailed analysis in
MD&A
NIRI suggests the creation of a CIRI suggests the CFO, Chief
disclosure policy committee Legal Counsel, Chief
charged with reviewing and Operating Officer, Senior IR
approving material disclosure executive and Corporate
Controller
Confined only to disclosure Needs to be material
that are mandatory or
otherwise in the companys
business interests
As soon as predictable Continuous disclosure
Must include the Must disclose accounting
corresponding GAAP principles used in your EPR
information, a reconciliation of
the items
Required by law Required by law
NIRI recommends the Audit committee in the least,
disclosure committee: board of directors approval
Members should include: required for annual reports
senior IR officer, general
counsel, controller, corporate
communications officer
Choose methods that are One of two Canadian news
reasonably calculated to make services SEDAR or CNW
effective, broad, and non-
exclusionary public disclosure
May include EPR, conference
call or webcast
49
Table 4

Obtaining participants

Panel A: Description of firms participating

Name Industry Total assets Big 4 U.S. SEC

(YE 2008) Auditor registered
Company A Financial Services > $300 billion Yes Yes
Company B Chemical > $500 million Yes No
Manufacturing
Company C Fast Food Industry > $1.5 billion Yes Yes
Company D Telecommunications > $17.0 billion Yes Yes
Company E Financial Services > $27 billion Yes Yes
Company F Telecommunications > $5.5 billion Yes Yes

Panel B: Informants who were interviewed at our six firms

Interviewee Companies Interviewee title Pseudonym

Company A Chief Accountant ACCT 1
Corporate Communications COMM 2
(Investor relations)
Legal Counsel LEGAL 1
Company B Chief Financial Officer CFO 1
Audit Partner AUDIT 1
Company C Vice president Investor IR 1
Relations
Company D Vice president - Investor IR 2
Relations
Company E Corporate Counsel LEGAL 2
Company F Vice President Investor IR 3
Relations
Audit Committee Member - LEGAL 3
Lawyer

50
Panel C: Corporate disclosure committee composition

Corporate Disclosure Committee Member

Chief
Investor Unit General Accountant
Company Relations CFO Busines /Legal (Controller)/ Other
Head s Heads Counsel Internal
Audit
Chief
Accountant
Company A X X Multiple X Communications
Controller
(Chair)
a. CEO
Company B X X b. Corporate
Controller
VP Corporate
Company C X X X X
Reporting
a. Tax Director
2 IR Controller
Company D X Multiple X b. External Auditor
people Internal audit
(observer)
a. VP Corporate
a. Chief Legal Treasurer
Affairs
Company E X Officer VP Financial
b. Chief Operating
b. Counsel Reporting
Officer
a. Chief Legal a. Chief Operating
Officer Chief Officer
Company F X
b. External Accountant b. VP Public
Counsel Relations

51
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