Research reveals that 'when you disclose your IT weaknesses, shareholder prices drop'
Companies forced to reveal shortcomings in their IT systems due to section 404 will underperform the market, according to new research.
Bruce Weber of the London Business School found that company share prices dropped significantly once they had reported system failings related to their internal controls.
Weber said: ‘If there are weaknesses in your financial systems, it will be punished.’
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