The Effects of Debt Contracting on Voluntary Accounting Method Changes

By Anne L. Beatty, Joseph P. Weber. 2003

269 citations recorded by the source corpus.

Subfields: Accounting, Strategy and Management

View Paper: https://www.semanticscholar.org/paper/d7a52ea86a8d10c77b9bc9b6a2f78db7ee44b21d

How researchers see this paper

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

In Accounting

In Strategy and Management

Citations in the corpus

How far can we trust earnings numbers? What research tells us about earnings management (2013, background): “In a contribution that exploits new data on bank lending debt contracts, Beatty and Weber (2003) conduct a detailed analysis of US bank lending noting that (1) many contracts do not allow borrowers to use voluntary accounting method changes to affect contract calculation; (2) debt contracts often in”
Earnings Management: An Analysis of Opportunistic Behaviour, Monitoring Mechanism and Financial Distress (2015, unknown): “Similarly, the study conducted by Sweeney (1994); Dichev & Skinner (2002) and Beatty & Weber (2003), reported that managers make an accounting choices in order to avoid debt covenant violations by applying income increasing motive.”
The Adoption of IFRS 3: The Effects of Managerial Discretion and Stock Market Reactions (2011, background): “Earnings-based managerial compensation also constitutes an incentive to opt for voluntary accounting changes that could increase future income streams (Beatty and Weber, 2003).”
Accounting Quality and Debt Contracting (2008, methodology): “…as a mark-up over LIBOR and is paid by the borrower on all drawn lines 11 Other papers that have used this database include Carey, Post and Sharpe (1998), Hubbard, Kuttner and Palia (1998), Strahan (1999), Sunder (2002), Beatty and Weber (2003), and Dennis, Nandy, and Sharpe (2000). of credit.”
Cash flows and leverage adjustments (2016, background): “Beatty and Weber (2003) investigated the effects of debt contracting on voluntary accounting method changes.”
The Contracting Benefits of Accounting Conservatism to Lenders and Borrowers (2008, unknown): “However, the voluminous empirical literature building on Watts and Zimmerman (1986) largely focuses on the use of accounting choices to avoid covenant violations (Press and Weintrop, 1989; Duke and Hunt, 1989; DeAngelo et al., 1994; Sweeney, 1994; Dichev and Skinner, 2002; Beatty and Weber, 2003).”
Corporate social responsibility and earnings management in U.S. banks (2014, methodology): “the impact of interest cover ratio and dividend pay-out (Beatty and Weber, 2003).”
Do Analysts Understand the Economic and Reporting Complexities of Derivatives (2016, unknown): “…are recorded in net income as they occur (i.e., no offset).5 Complexity aside, effective hedging can mitigate earnings and cash flow volatility (Zhang 2009), potentially reducing a firm’s borrowing costs (Beatty and Weber 2003), risk (Graham et al. 2005), and tax liability (Smith and Stulz 1985).”
Have IFRS Affected Earnings Management in the European Union? (2010, background): “That is consistent with previous research – Bartov (1993), DeFond and Jiambalvo (1994), Sweeney (1994) or Beatty and Weber (2003).”
Impact of proximity to debt covenant violation on earnings management (2013, unknown): “Beatty and Weber (2003) and Sweeney (1994) find evidence of earnings management to avoid reducing dividends, whereas DeAngelo et al. (1994) and Healy and Palepu (1990) do not. For completeness, we include the indicator variable DIV, which equals one if the debt contract contains a dividend constrain”