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Accounting Restatement


Restating previous financial statements is a signal worth attention and investigation. This measure counts the number of restatements in the past fiscal year (configurable to arbitrary number of years) due to various reasons based on the WRDS AuditAnalytics Non-Reliance Restatement dataset.

Specifically, the following variables from WRDS.AUDIT.AUDITNONRELI are used:

Variable Description
company_fkey EDGAR CIK
file_date Filing date
res_notif_key Restatement notification key
res_accounting Restatement due to accounting issues
res_adverse Restatement had an adverse impact
res_fraud Restatement related to fraud
res_cler_err Restatement due to clerical errors
res_sec_invest Restatement followed by SEC investigation

The dataset is merged with WRDS.COMP.FUNDA on CIK, grouped by gvkey and datadate. Then the frequency of each restatement type is counted.

Last update: July 27, 2020