arbiter
JournalsPricingAccount

THE DIFFERENTIAL IMPACT OF PRIVATE AND PUBLIC DEBT ON ACCOUNTING CONSERVATISM

Fengyun Wu

Accounting and Taxation2021article
ABDC C
Weight
0.26

What the paper says

The private and public debt markets differ in monitoring functions and covenant features. This paper empirically examines whether these differences impact accounting conservatism. Using a sample drawn from Loan Pricing Corporation’s Dealscan, I find that firms report more conservatively in the years following the issuance of private debt than the years before. I also find that firms report more conservatively following initial public debt offerings (bond IPOs). However, there is no change in the degree of conservatism around seasoned bond offerings. I interpret the results as reflecting differences in monitoring functions of the private and public debt markets. The direct monitoring by private debt holders and the external monitoring including regulatory scrutiny in the context of bond IPOs are effective in enforcing accounting conservatism. The limited monitoring in the case of seasoned bonds fails to do so.

1 citation

Cite this paper

@article{fengyun2021,
  title        = {{THE DIFFERENTIAL IMPACT OF PRIVATE AND PUBLIC DEBT ON ACCOUNTING CONSERVATISM}},
  author       = {Fengyun Wu},
  journal      = {Accounting and Taxation},
  year         = {2021},
}

Paste directly into BibTeX, Zotero, or your reference manager.

Flag this paper

THE DIFFERENTIAL IMPACT OF PRIVATE AND PUBLIC DEBT ON ACCOUNTING CONSERVATISM

Flags are reviewed by the Arbiter methodology team within 5 business days.

Evidence weight

0.26

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.00 × 0.4 = 0.00
M · momentum0.20 × 0.15 = 0.03
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.