Figure 1
The line graph is titled “DisclosureTimeliness (medians)”. The vertical axis is labeled “Percentage Distance from Full Disclosure” and ranges from 0 to 1.2, in increments of 0.2. The horizontal axis is labeled “Quarter Relative to A S C 606 Adoption” and displays the values from negative 6 to negative 1 in increments of 1. The graph shows two plotted curves. A legend below the graph labels the two curves as “Positive 606 Effect” and “Negative 606 Effect.” The curve for “Positive 606 Effect” starts at (negative 6, 0), increases to (negative 5, 0.31), slightly increases to (negative 4, 0.32), rises to around (negative 3, 0.43), increases further to (negative 2, 0.65), and ends at (negative 1, 1.0). The curve for “Negative 606 Effect” starts at (negative 6, 0), increases slightly to (negative 5, 0.05), rises to (negative 4, 0.20), increases to (negative 3, 0.24), rises to (negative 2, 0.58), and ends at (negative 1, 1.0). Note: All numerical values are approximated.DisclosureTimeliness median graph. Note: The median percentage distance from full disclosure over quarters −6 to −1, relative to the quarter that the firm adopts ASC 606. The blue line depicts positively affected firms (NI_606 > NI_605), and the orange line depicts negatively affected firms. By construction, the percentage full disclosure in quarter −6 is 0%, and the percentage full disclosure in quarter −1 is 100%. Each firm-quarter observation is adjusted, if necessary, to capture the distance from full disclosure to 100%. See Appendix C or the variable appendix for details. DisclosureTimeliness can be visualized as the area under this curve