For the remaining 40, I required ex postevidence of manipulation. That is, I required that the companies had to restate earnings to comply with GAAP at the request of auditors or following the conclusion of an internal investigation. This
requirement made this sample consistent with the sample from the AAER search, in the sense that a restatement (in addition to a permanent injunction from future violations of security laws) is usually the outcome of a successful SEC investigation.