Joint Tests of Signaling and Income Smoothing Through Bank Loan Loss Provisions

By Kiridaran Kanagaretnam, Dong-Hoon Yang, Gerald J. Lobo. 2000

274 citations recorded by the source corpus.

View Paper: https://www.semanticscholar.org/paper/7e33efb415a9054367c5ed7960b67231ef3ea972

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Citations in the corpus

Understanding Earnings Quality: A Review of the Proxies, Their Determinants and Their Consequences (2010, background): “29 See, for example, White (1970), Dascher and Malcom (1970), Barefield and Comiskey (1971), Barnea et al. (1976), McNichols and Wilson (1988), Moses (1987), Dharan (1987), Chaney et al. (1998), Hand (1989), and Kanagaretnam et al. (2004).”
Auditor Reputation and Earnings Management: International Evidence from the Banking Industry (2010, methodology): “Our proxy for abnormal loan loss provisions is based on prior banking research on loan loss provisions (Wahlen, 1994; Kanagaretnam et al., 2004).”
Effects of national culture on earnings quality of banks (2011, unknown): “…(DNPL), and beginning balance of loan loss allowance (BEGLLA) to account explicitly for the nondiscretionary portion of LLP. Prior studies (e.g., Kanagaretnam et al., 2004; Wahlen, 1994) suggest that LCO, BEGNPL, and DNPL are positively related to LLP. BEGLLA will be negatively related to LLP,…”
Ability of accounting and audit quality variables to predict bank failure during the financial crisis (2011, unknown): “Additionally, in an international banking setting, Kanagaretnam et al. (2010) find that auditor industry specialization constrains earnings management.”
Managerial Ability and Income Smoothing (2019, unknown): “There is a fairly well developed empirical literature on determinants of smoothing (e.g., Dascher and Malcom 1970; Barnea et al. 1976; McNichols and Wilson 1988; Chaney et al. 1998; Kanagaretnam et al. 2004).”
GDP management to meet or beat growth targets (2018, unknown): “Subsequent studies find that discontinuity in earnings distribution can be attributed to unusual accounting treatments in accounts that are likely related to earnings management, such as bad debt allowance, discontinued operations, loan loss provisions, marketing and advertising expenses, restructur”
How Does Internal Control Regulation Affect Financial Reporting (2010, result): “Consistent with previous bank earnings quality research (Wahlen,1994, Kanagaretnam et al., 2004,), we measure cash flows by adding the loan loss provision to earnings before 14 taxes.10 The persistence of the provision should not affect this cash flow measure, so we believe a separate examination…”
Bank Loan Loss Provisions Research: A Review (2017, background): “The fifth strand of literature relate to studies that test the income smoothing hypothesis commonly referred to as the LLP-income smoothing literature that examine whether banks overstate (or understate) LLPs when earnings are high (or low) in order to report smooth earnings so that reported earning”
Conditional conservatism and the limits to earnings management (2020, unknown): “First, we provide the first empirical evidence of a negative relation between conditional conservatism and accruals earnings management, consistent with the arguments of Watts (2003) and LaFond and Watts (2008) and with the analytical evidence of Chen et al.”
Bank Income Smoothing, Ownership Concentration and the Regulatory Environment (2014, unknown): “In the literature this is generally captured by the one-year-ahead change of earnings before taxes and loan loss provisions (ERi,t+1 − ERi,t) (Ahmed et al. 1999, Kanagaretnam et al. 2004).”
Policy uncertainty and loan loss provisions in the banking industry (2020, unknown): “…use loan loss provisions as a signal of expected loan conditions (e.g., Scholes et al., 1990; Wahlen, 1994; Beaver and Engel, 1996; Liu et al., 1997; Kanagaretnam et al., 2004, 2005), then we would expect more future charge-offs for banks that make more loan loss provisions in the current period.”