This paper evidences the strategic positioning of positive and negative words within a CEO letter as a subtle form of impression management. We find that managers tend to present information in such an order that the reader of the CEO letter has a more positive perception of the underlying message. We uncover a smile in the frequency of positive words within the letter, and a half smile in the intratextual distribution of negative words, with a prevalence of negative words at the beginning of the letter. We also find a significant positive association between this qualitative impression management and the use of abnormal accruals in earnings management. Boudt, K and Thewissen, J (2019) Jockeying for Position in CEO Letters: Impression Management and Sentiment Analytics Financial ManagementSpring 2019pp 77 115

Required:

Critically explore the role of narrative reporting in providing useful information to investors and discuss the implication of these findings on the quality of this narrative.

1500 words