The Contracting Benefits of Accounting Conservatism to Lenders and Borrowers

By Jieying Zhang. 2008

897 citations recorded by the source corpus.

Subfields: Accounting, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/42d30f3c2741593f52ed578844f2702c40544bfa

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Accounting

1. Jeong‐Bon Kim
2. Martin Walker
3. Christian Leuz
4. Peter D. Wysocki
5. Beatriz García Osma
6. Juan Manuel García Lara
7. Jere R. Francis
8. Liandong Zhang

In Strategy and Management

1. Christian Leuz
2. Peter D. Wysocki
3. Martin Walker
4. Beatriz García Osma
5. Juan Manuel García Lara
6. Jeong‐Bon Kim
7. Jere R. Francis
8. Fernando Penalva

Citations in the corpus

• CEO Gender, Ethical Leadership, and Accounting Conservatism (2015, background): “Here, accounting conservatism provides contracting benefits by hastening debt covenant violations, thus ‘‘triggering the alarm’’ earlier (Zhang 2008).”
• A measurement approach to conservatism and earnings management (2013, result): “These predictions are consistent with the existing evidence such as Ball, Kothari, and Robin (2000), Watts (2003b), Zhang (2008), Watts and Zuo (2011), and Kim, Li, Pan, and Zuo (2012).”
• The Economics of Disclosure and Financial Reporting Regulation: Evidence and Suggestions for Future Research (2015, background): “Zhang (2008) finds that lenders offer lower interest rates to firms that report conservative earnings numbers.28 Studies on the cost of debt face the same selection and endogeneity concerns as cost-of-equity studies.”
• Capital Allocation and Timely Accounting Recognition of Economic Losses (2011, neutral): “2 (e.g., Watts and Zimmerman, 1986; Roychowdhury and Watts, 2007; Beatty et al., 2008; Zhang, 2008; Wittenberg-Moerman, 2008).”
• The Effect of Accounting Conservatism on Corporate Investment during the Global Financial Crisis: THE EFFECT OF ACCOUNTING CONSERVATISM (2016, neutral): “The first assumption is consistent with the notion that a firm’s conservatism level is relatively stable over time (e.g., Beatty et al. 2008; Zhang 2008; Francis and Martin 2010; Kim et al. 2013).”
• Accounting Conservatism and Stock Price Crash Risk: Firm-level Evidence. (2012, positive): “Several recent studies examine the economic consequences of conservatism in the context of the debt market (e.g., Ahmed, Billings, Morton, and Stanford-Harris 2002; Ball, Bushman, and Vasvari 2008; Beatty, Weber, and Jiewei Yu 2008; Nikolaev 2010; Wittenberg-Moerman 2008; Zhang 2008).”
• The implications of research on accounting conservatism for accounting standard setting (2015, background): “reserves measure of Penman and Zhang (2002). They find that value relevance has declined and that unconditional conservatism has increased over the time.”
• The Benefits of Conservative Accounting to Shareholders: Evidence from the Financial Crisis (2013, positive): “This measure is based on Givoly and Hayn (2000) and is widely used in the accounting literature (e.g., Ahmed and Duellman 2007; Beatty et al. 2008; Zhang 2008).”
• Earnings quality research: Advances, challenges and future research (2010, background): “However, there is also evidence that TLR reduces the costs of borrowing (e.g., Zhang, 2008).”
• Acquisition Profitability and Timely Loss Recognition (2010, background): “Prior research shows the role of accounting conservatism in mitigating agency costs arising from shareholder-bondholder conflicts (e.g., Ahmed et al., 2002; Ball et al., 2008; Zhang, 2008).”