Technology in accounting: Social media as effective platform for financial disclosures

Abstract

Many people have embraced social media (SM), including both personal and professional uses. Corporations hoping to capitalize on this indoctrination are seeking to understand ways they can engage in SM. One possible idea is disseminating financial results. This topic emerged as a result of the recent decision by the Securities and Exchange Commission granting permission. A problem for company leadership is the lack of understanding of the potential SM has to enhance shareholder value. Little research exists today on the impact of a corporate policy to use social web to announce dividend or earnings statements on shareholder value. This research studied SM platforms for financial communications on stock price. By calculating cumulative abnormal returns, researchers learned the impact of SM for financial disclosures. The sample size included thirty-four publicly traded American financial institutions. This research seeks to advance understanding of financial statement dissemination using SM.