The Role of Accounting Conservatism in Mitigating Bondholder-Shareholder Conflicts over Dividend Policy and in Reducing Debt Costs

By Anwer S. Ahmed, Bruce K. Billings, Richard M. Morton, Mary Stanford‐Harris. 2002

968 citations recorded by the source corpus.

Subfields: Accounting, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/42833f3b67ec8e43949f28cd2fa6912f4bbd2a11

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Citations in the corpus

Conditional conservatism and the limits to earnings management (2020, positive): “Ahmed et al. (2002) provide similar arguments to support their empirical findings that conservatism leads to lower cost of debt.”
Credit Ratings and Taxes: The Effect of Book–Tax Differences on Ratings Changes (2008, background): “Prior research notes that the cost of debt is associated with firm characteristics such as size, profitability, and risk (e.g., Kaplan and Urwitz 1979; Sengupta 1998; Ahmed et al. 2002; Jiang 2008).”
Fair-Value Pension Accounting (2007, methodology): “, Ahmed et al., 2002, Francis et al., 2005), we use Standard and Poor’s long-term issuer credit rating as a proxy for default probability. Standard and Poor’s (2003) defines this as the “opinion of an issuer’s overall credit worthiness, apart from its ability to repay individual obligations.”
The World Price of Earnings Opacity (2003, positive): “We follow Givoly and Hayn (2000) and Ahmed et al. (2002) and use accruals to measure earnings aggressiveness.”
The Effects of Contracting, Litigation, Regulation, and Tax Costs on Conditional and Unconditional Conservatism: Cross-Sectional Evidence at the Firm Level (2007, background): “2000), public firms (Ball and Shivakumar 2005), firms facing more severe conflicts over dividend policy (Ahmed et al. 2002), and firms monitored by more independent boards (Beekes et al. 2004). All of this evidence is consistent with the contracting hypothesis. Several studies provide evidence of th”
Gender Differences in Financial Reporting Decision-Making: Evidence from Accounting Conservatism (2015, positive): “Following prior studies, such as Ahmed et al. (2002), Ahmed and Duellman (2007), and LaFond and Roychowdhury (2008), we include the following firm-level control variables in our regressions: Log(Asset) - the natural log of total assets; Profitability - earnings before interest, taxes, and…”
Internal Controls and Conditional Conservatism (2011, methodology): “Firms with high levels of leverage tend to have greater bondholder and shareholder conflicts that, in turn, increase the contractual demand for conservatism (Ahmed et al. 2002; Zhang 2008).”
Analyst Following and Credit Ratings (2008, methodology): “As in prior research (e.g., Ahmed, Billings, Morton, and Stanford-Harris 2002; Bhojraj and Sengupta 2003; Ashbaugh, Collins, and LaFond 2006; Francis et al. 2005), we use S&P’s issuer credit rating as a measure of a firm’s default risk.”
Acquisition Profitability and Timely Loss Recognition (2010, positive): “, Ahmed et al., 2002; Ball et al., 2008; Zhang, 2008). Our study suggests that conservative accounting policy can also reduce agency conflicts between shareholder and managers. LaFond and Watts (2008) document that information asymmetry between shareholders and managers leads to more conservative fi”
The Contracting Benefits of Accounting Conservatism to Lenders and Borrowers (2008, positive): “Ahmed et al. (2002) are the first to document that conservatism reduces the cost of debt for borrowers, i.e., more conservative borrowers receive better debt ratings.”