Corporate Cautionary Statement: A Genre of Professional Communication
Authors: Chie Urawa
Cautionary statements or disclaimers in corporate annual reports need to be carefully designed because clear cautionary statements may protect a company in the case of legal disputes and may undermine positive impressions. This study compares the language of cautionary statements using two corpora, Sony’s cautionary statement corpus (S-corpus) and Panasonic’s cautionary statement corpus (P-corpus), illustrating the differences and similarities in relation to the use of meaningful cautionary statements and critically analyzing why practitioners use the way. The findings describe the distinct differences between the two companies in the presentation of the risk factors and the way how they make the statements. The word ability is used more for legal protection in S-corpus whereas the word possibility is used more to convey a better impression in P-corpus. The main similarities are identified in the use of lexical words and pronouns, and almost the same wordings for eight years. The findings show how they make the statements unique to the company in the presentation of risk factors, and the characteristics of specific genre of professional communication. Important implications of this study are that more comprehensive approach can be applied in other contexts, and be used by companies to reflect upon their cautionary statements.
Digital Object Identifier (DOI): doi.org/10.5281/zenodo.1316207Procedia APA BibTeX Chicago EndNote Harvard JSON MLA RIS XML ISO 690 PDF Downloads 403
 Ahmad, K., Gillam, L. and Tostevin, L. 1999. Weirdness Indexing for Logical Document Extrapolation and Retrieval WILDER. University of Surrey TREC8. http://trec.nist.gov/pubs/trec8/papers/surrey2.pdf
 Al-Shammari, B. 2014. Kuwait corporate characteristics and level of risk disclosure: a content analysis approach. Journal of Contemporary Issues in Business Research, 3(3), pp.128-153.
 Andrew Slayton v. American Express No. 08-5442 2d Cir. 2010. Justia US Law. http://cases.justia.com/federal/appellate-courts/ca2/08-5442/08-5442-cv_opn-2011-03-27.pdf?ts=1410917259
 Asay, H. S. and Hales, J. 2015. Building a Safe Harbor for Whom? A Look at Cautionary Disclaimers and Investors' Reactions to Forward-Looking Statements. https://business.illinois.edu/accountancy/wp-content/uploads/sites/12/2015/05/Asay_Hales.pdf.
 Baker, P., Hardie, A. and McEnery, T. 2006. A glossary of corpus linguistics. Edinburgh: Edinburgh University Press.
 Bhatia, V. K. 2004. Worlds of written discourse: A genre-based view. Continuum.
 Bhatia, V. K. 2010. Interdiscursivity in professional communication. Discourse & Communication, 4(1), pp.32-50.
 Bhatia, V. K. 2012. Professional Written Genres. In Gee, J. P. & Handford, M. (Eds.). The Routledge Handbook of Discourse Analysis. Routledge.
 Bhatia, V. K. 2014. Analysing discourse variation in professional contexts. In Bhatia, V. and Bremner, S. (Eds.) The Routledge Handbook of Language and Professional Communication, Routledge. pp.3-12.
 Cabinet Office Ordinance, Japan. 2003. No. 28. http://law.e-gov.go.jp/htmldata/S48/S48F03401000005.html
 Campbell, J. L., Chen, H., Dhaliwal, D. S., Lu, H. M., & Steele, L. B. 2014. The information content of mandatory risk factor disclosures in corporate filings. Review of Accounting Studies, 19(1), pp.396-455.
 Capuano v. Humana Inc. et al No. 3:2008cv00162 - Document 57, W.D. Ky. 2009. Justia US Law. http://law.justia.com/cases/federal/district-courts/kentucky/kywdce/3:2008cv00162/64979/57/.
 Cheng, W. and Ching, T. 2016. ‘Not a Guarantee of Future Performance’: The Local Grammar of Disclaimers. Applied Linguistics, p.amw006.
 Chivers, C. and Quinn, G. 2010. The Importance of Well Drafted Forward-Looking Statement Disclosures, Insights: Corporate & Securities Law Advisor Vol. 24 No. 2. pp.8-12.
 Companies Act of Japan. 2005. http://www.japaneselawtranslation. go.jp/law/detail/?id=2052&vm=04&re=02.
 Congress Report. 1995. 104th Congress 1st session, House of Representatives Report 104-369. 42-44. https://www.congress.gov /104/crpt/hrpt369/CRPT-104hrpt369.pdf.
 Financial Instruments and Exchange Act of Japan. Act No. 25 of 1948, Amendment No. 109 of 2006, http://www.japaneselawtranslation.go.jp /law/detail/?id=1911&vm=04&re=02.
 Hunston, S. and Sinclair, J. M. 2000. A local grammar of evaluation. In S. Hunston and G. Thompson (eds): Evaluation in Text: Authorial Stance and the Construction of Discourse. Oxford University Press, pp.74–101.
 Imagawa, Y. 2002. Disclosure Duty in Corporate Quarterly Report. Kobe-Gakuin Hogaku, 32(1). 79-109. http://www.law.kobegakuin.ac.jp/~jura /hogaku/.
 Itoh, K., Kitagawa, T., Kuronuma, E., Saga, T., Suda, K., Hiramatsu, K., Fuchida, Y., Machida, Y., Yanagi, R., Wakazono, T. and Tsuburaya, S. 2011. Information Disclosure Report of Stock Corporations. The Japan Society of Securities and Economics 29 July 2011. http://www.tse.or.jp/rules/kessan/gyouseki/b7gje6000001vb28-att/ b7gje6000001vb42.pdf.
 Johnson, M. F., Kasznik, R. and Nelson, K. K. 2001. The impact of securities litigation reform on the disclosure of Forward-Looking information by high technology firms. Journal of Accounting Research 39(2), pp.297-327.
 Kravet, T. and Muslu, V. 2013. Informativeness of Risk Disclosures in Corporate Annual Reports, Review of Accounting Studies. (18), pp.1088.
 McLaren-Hankin, Y. 2008. We expect to report on significant progress in our product pipeline in the coming year': hedging forward-looking statements in corporate press releases. Discourse Studies, 10(5), pp.635-654.
 Mercer, M., Palmiter, A.R. and Taha, A.E. 2010. Worthless warnings? Testing the effectiveness of disclaimers in mutual fund advertisements. Journal of Empirical Legal Studies, 7(3), pp.429-459.
 Nelson, K. K. and Pritchard, A. C. 2016. Carrot or stick? The shift from voluntary to mandatory disclosure of risk factors. Journal of Empirical Legal Studies, 13(2) 266-297.
 Panasonic annual report 2008-2015, http://www.panasonic.com/global /corporate/ir/annual.html.
 Rayson, P. 2008. From key words to key semantic domains. International Journal of Corpus Linguistics, 13(4) 519-549.
 Ripken, S. K. 2005. Predictions, Projections, and Precautions: Conveying Cautionary Warnings in Corporate Forward-Looking Statements. University of Illinois Law Review 929.
 Private Securities Litigation Reform Act (PSLEA). 1995. U.S. Securities and Exchange Commission https://www.sec.gov/news/studies/lreform.txt.
 Securities and Exchange Act of 1934, § 21E, 15 U.S.C. § 78u-5. Cornell University of Law School http://www.law.cornell.edu/uscode/text/ 15/78u-5.
 Sinclair, J. 2005. Corpus and text-basic principles. In Wynne, M. (Ed.). Developing Linguistic Corpora: a Guide to Good Practice. AHDS guides to good practice. Oxbow Books Oxford. pp.1-21. http://www.ahds. ac.uk/creating/guides/linguistic-corpora/chapter1.htm.
 Sony annual report. 2008-2013. Sony Global http://www.sony.net/ SonyInfo/IR/financial/ar/Archive.html.
 Sony annual report 20F. 2014-2015. Sony Global http://www.sony.net /SonyInfo/IR/library/sec.html.
 US Securities and Exchange Commission (SEC). Office of Investor Education. 1998. A plain English handbook: How to create clear SEC disclosure documents. https://www.sec.gov/pdf/handbook.pdf.
 US Securities and Exchange Commission (SEC). 1999. Division of Corporate Finance: Updated Staff Legal Bulletin No. 7 “Plain English Disclosure” June 7. https://www.sec.gov/interps/legal/cfslb7a.htm
 US Securities and Exchange Commission (SEC). 2005. Form 10-K. p.8. https://www.sec.gov/about/forms/form10-k.pdf.
 Yamashita, M. 2014. Investigation result requested by Chie Urawa. Kimura-Sougou Legal Office, 5F Yaesu Building 2-10-8, Yaesu Chuo-ku Tokyo, Japan.
 Zaimu-kenkyukai. 2008. Safe Harbor Rule. Weekly Management Finance 2859. 3 March. 38. http://www.zeiken.co.jp/cst/weeklyDetail.php?tgt Magazine=2&tgtYear=2008&issueid=1774.