Advances in Accounting最新文献

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Balance sheet strength in the oil and gas industry: Saving for a rainy day or making hay while the sun shines

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2025-02-08 DOI: 10.1016/j.adiac.2025.100806

Mark Anderson , Yan Ma , Han-Up Park

We examine how a strategic emphasis on balance sheet strength relates to investment decisions and performance over time for firms operating in a cyclical environment. From a series of discussions with industry insiders and readings of disclosures for prominent oil and gas (O&G) companies in Canada, we identify two groups of upstream O&G firms based on how they match their resources and capabilities with the uncertainties posed by industry economic cycles. One group of firms borrows and invests aggressively when oil prices are strong and funds are available – “making hay while the sun shines”, while the other group grows conservatively to build and maintain balance sheet strength – “saving for a rainy day”. We use average cash flows to debt for each firm over time to measure emphasis on balance sheet strength and separate firms into rainy day and making hay companies. We leverage two steep price declines to observe the behavior of firms over industry cycles: one triggered by the widespread 2008 financial crisis and the other by a distinct and prolonged O&G industry downturn in 2014. While investment declined generally in both cases, we find that the decline in investment was significantly less for rainy day companies than making hay firms after the 2014 downturn. Across time, we find that rainy day companies make shrewder acquisitions and operate more efficiently than making hay companies. Nonetheless, the capital market rewards making hay companies with higher market valuation, but this is reduced in downturns.

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引用次数: 0

Private lenders and borrowers' internal control-related private information

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2025-02-07 DOI: 10.1016/j.adiac.2025.100808

Md Mahmudul Hasan

This study investigates the relationship between lenders' demand for management letters, which contain borrowers' private information regarding internal control, and the effectiveness of borrowers' internal controls. Since only material weaknesses in internal controls must be publicly disclosed, firms can publicly claim that their internal controls are effective even if they have deficiencies in internal controls but no material weaknesses. This study reveals that lenders are more likely to ask for management letters from borrowers who have revealed material weaknesses in their internal controls. The study also finds that lenders are more likely to ask for management letters from borrowers with financial distress and when borrowers are involved in risky activities like aggressive tax avoidance. In addition, firms with ineffective internal controls from whom lenders have demanded management letters are more likely to remediate their material weaknesses than those not subject to such demands. This study adds to the limited literature on how lenders use borrowers' private information in loan contract monitoring and how lenders can impact borrowers' internal controls without the contractual transfer of control rights.

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引用次数: 0

Executive age, executive gender and financial statement comparability

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2025-01-06 DOI: 10.1016/j.adiac.2024.100805

Shadi Farshadfar , Laleh Samarbakhsh , Ismat Jahan

This study investigates the association between chief executive officer (CEO) age and gender and the financial statement comparability of their firm. Our findings indicate that CEO age and gender are positively associated with comparability. We extend the literature by establishing executive age and gender as determinants of comparability. The results are independent of a battery of sensitivity tests, including applying alternative comparability measures, industry dominance of young CEOs, self-selection bias, and corporate governance measures. Our analysis further suggests that the age and gender of other executives, particularly chief financial officers (CFOs) and the top management team (TMT), impact comparability similarly to those of the CEO.

引用次数: 0

The impact of IFRS 16 on lessees' financial information: A single-industry study

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2024-12-20 DOI: 10.1016/j.adiac.2024.100803

Ana Isabel Lopes , Daniela Penela

This single-industry study responds to the IFRS Foundation's call to determine the effects of implementing IFRS 16 by analyzing the isolated post-implementation effect of IFRS 16 on lessee financial statements. Using real implementation data, the findings confirm the expected results of prior studies using estimated data, in that the implementation of IFRS 16 is the primary driver of statistically significant changes in assets, liabilities, EBIT, EBITDA, and financial expenses, resulting in major changes in the structure and liquidity ratios. Regarding profitability ratios, this study adds to the literature by demonstrating a statistically significant difference in ROA. Furthermore, while prior studies suggest that the interest coverage ratio would decrease, the use of real implementation data shows no statistically significant finding on this ratio; this indicates that the increase in EBITDA and interest expenses may cancel each other out, resulting in no impact on the coverage ratio. The results support the main criticism of IAS 17—that operating leases were improperly accounted for and consequently altered the picture of financial statements and ratios, which is a key source of information in valuing companies. This single-industry study, one of the more extensive IFRS Foundation 2016 studies, is the first to use real IFRS 16 adoption data, providing substantial results regarding the impact of this standard on the financial statements of publicly traded companies. These results encourage further research using similar approaches with broader sample sizes.

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引用次数: 0

The impact of profitability pressure and capital market valuation on tax haven engagement

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2024-12-19 DOI: 10.1016/j.adiac.2024.100804

Linda H. Chen , George J. Jiang , Weiwei Wang , Joseph H. Zhang

We investigate three key research questions related to firms' engagement in tax haven activities: (1) the relationship between firm profitability pressures and tax haven involvement, (2) how the capital markets price tax haven activities as potential risks, and (3) whether firm profitability pressures moderate the relationship between tax haven involvement and capital market risk perceptions. Analyzing data from 1995 to 2020, we find that firms facing profitability pressure are more likely to engage in tax haven activities. Additionally, tax haven involvement is typically viewed negatively by capital markets, signaling heightened information risk and agency costs. However, under profitability pressures, capital markets assess tax haven activities less unfavorably. These findings highlight the need to better understand the drivers of aggressive tax avoidance strategies.

引用次数: 0

The interactive effects of strategy communication and report integration on investors' reactions to corporate social responsibility measures 战略沟通和报告整合对投资者对企业社会责任措施反应的互动影响

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2024-11-21 DOI: 10.1016/j.adiac.2024.100784

Lei Wang , Lei Dong

This study examines nonprofessional investors' reactions to two important factors underlying the disclosure of corporate social responsibility (CSR) measures: report integration and strategy communication. We find that CSR measures in an integrated report appear to affect nonprofessional investors less than CSR measures in a standalone report. Providing strategy communication that conveys CSR strategic objectives and a causal connection between CSR performance and financial performance promotes investors' incorporation of CSR measures into their judgments and decisions. Together, report integration and CSR strategy communication interact to affect investment judgments and decisions, such that the weakened effect of CSR measures in an integrated report is less pronounced when CSR strategy communication is present than when CSR strategy communication is absent. As the interest in CSR reports continues to grow among investors, preparers, auditors, standard setters, regulators, and researchers, this study highlights the interplay between strategy communication and report integration in CSR disclosures.

本研究探讨了非专业投资者对披露企业社会责任（CSR）措施的两个重要因素的反应：报告整合和战略沟通。我们发现，综合报告中的企业社会责任措施对非专业投资者的影响似乎小于独立报告中的企业社会责任措施。提供战略沟通，传达企业社会责任战略目标以及企业社会责任绩效与财务绩效之间的因果关系，会促进投资者将企业社会责任措施纳入其判断和决策。报告整合与企业社会责任战略沟通相互作用，共同影响投资判断和决策，因此，与缺乏企业社会责任战略沟通的情况相比，有企业社会责任战略沟通的情况下，整合报告中企业社会责任措施的弱化效果并不明显。随着投资者、编制者、审计师、标准制定者、监管者和研究人员对企业社会责任报告的兴趣与日俱增，本研究强调了企业社会责任披露中战略沟通和报告整合之间的相互作用。

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引用次数: 0

Accrual accounting and access to external funds: Evidence from small businesses 权责发生制会计与外部资金的获取：来自小型企业的证据

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2024-11-20 DOI: 10.1016/j.adiac.2024.100786

Philip Keejae Hong , Kyonghee Kim , Sukesh Patro , Kyunghwa Yu

This study explores how the use of accrual accounting, as opposed to cash accounting, is related to small businesses' access to external funds and the type of borrowing relationships they have. The findings show that the use of accrual accounting is associated with better access to lines of credit and trade credit, which are important sources of external financing for small businesses. The use of accrual accounting is also positively associated with larger borrowing amounts, more favorable borrowing terms, the establishment of more credit relationships, and with more distant financial institutions. Likewise, accrual accounting is associated with shorter borrowing relationships and less reliance on personal contact with financial institutions. Overall, this study demonstrates a significant association between the use of accrual accounting and improved access to external finance for small businesses, suggesting that the informational limitations of cash accounting may be related to greater constraints in accessing external funding.

本研究探讨了相对于收付实现制会计而言，权责发生制会计的使用与小企业获取外部资金的途径及其借贷关系类型之间的关系。研究结果表明，使用权责发生制会计与更好地获得信贷额度和贸易信贷有关，而这是小企业外部融资的重要来源。使用权责发生制会计还与借款金额更大、借款条件更优惠、建立更多信贷关系以及与更远的金融机构有正相关。同样，权责发生制会计也与较短的借贷关系和较少依赖与金融机构的个人联系有关。总之，这项研究表明，使用权责发生制会计与小企业获得外部融资的机会增加之间存在显著联系，这表明现金会计的信息局限性可能与获得外部资金的更大限制有关。

引用次数: 0

Employee education and corporate tax outcomes: Evidence from firm-level reporting 员工教育与企业纳税结果：来自公司层面报告的证据

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2024-11-12 DOI: 10.1016/j.adiac.2024.100785

Hanzhong Shi , Kaishu Wu , Kerui Zhai

Taking advantage of a unique financial reporting feature in the Chinese setting, this study examines whether the education level of a firm's rank-and-file employees is associated with its tax outcomes. We provide robust evidence that employee education is associated with reduced tax avoidance. Leveraging path analysis, we show that highly educated employees are related to corporate tax avoidance through a financial reporting channel and a corporate social responsibility (CSR) channel. In addition, we find that the main effect is more pronounced when employees have the right to voice their concerns and when the accounting department accounts for a greater portion of total employees. Finally, we show that employee education is associated with reduced tax risk. Overall, our study extends an emerging body of literature on the association between employee education and firm-related outcomes (e.g., Call, Campbell, Dhaliwal, & Moon Jr., 2017), along with finding another important determinant of corporate tax planning.

本研究利用中国独特的财务报告特点，考察了企业普通员工的教育水平是否与其纳税结果相关。我们提供的有力证据表明，员工受教育程度与避税行为的减少有关。通过路径分析，我们发现高学历员工通过财务报告渠道和企业社会责任（CSR）渠道与企业避税相关。此外，我们还发现，当员工有权表达自己的担忧，且会计部门占员工总数的比例较大时，主效应更为明显。最后，我们还发现，员工教育与税务风险的降低有关。总之，我们的研究扩展了员工教育与公司相关结果之间关系的新兴文献（例如，Call, Campbell, Dhaliwal, & Moon Jr., 2017），同时还发现了企业税收筹划的另一个重要决定因素。

引用次数: 0

Discussion of using accounting information to identify corporate acquisition motives: Implications on post-acquisition performance 讨论利用会计信息识别企业收购动机：对收购后业绩的影响

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2024-11-07 DOI: 10.1016/j.adiac.2024.100783

Willie D. Reddic , Joshua C. Racca

引用次数: 0

Climate risk and asymmetric cost behavior 气候风险和不对称成本行为

IF 1.2 Q3 BUSINESS, FINANCE

Advances in Accounting

Pub Date : 2024-10-15 DOI: 10.1016/j.adiac.2024.100782

Kareen Brown , Sohyung Kim , Cheol Lee , Parunchana Pacharn

Prior research indicates that managerial expectations about a firm's future can lead to asymmetric cost behavior or cost stickiness; optimism increases cost stickiness, while pessimism reduces it. We predict and find that firms facing greater climate risk exhibit less cost stickiness, aligning with the threat-rigidity perspective where managers are either reluctant to add new resources or dispose excess ones under high climate risk. This reaction intensifies over time. After the 1997 Kyoto Protocol, cost stickiness is less sticky, reflecting long-term intertemporal changes in managerial perceptions of climate risk and its impact on cost stickiness. In addition, firms in U.S. coastal states, those in agriculturally intensive states, or those financially constrained react more strongly to climate risk. Finally, we find evidence that political environments influence this cost behavior; firms show less cost stickiness under Democratic administrations and in states that vote Democratic.

先前的研究表明，管理者对企业未来的预期会导致非对称成本行为或成本粘性；乐观会增加成本粘性，而悲观会减少成本粘性。我们预测并发现，面临较大气候风险的企业会表现出较低的成本粘性，这与威胁-僵化观点一致，即在高气候风险下，管理者要么不愿增加新资源，要么不愿处置多余资源。这种反应会随着时间的推移而加剧。1997 年《京都议定书》签署后，成本粘性降低，这反映了管理者对气候风险的认识及其对成本粘性影响的长期跨期变化。此外，美国沿海州、农业密集州或财政紧张州的企业对气候风险的反应更为强烈。最后，我们发现了政治环境影响这种成本行为的证据；在民主党执政时期和民主党投票的州，企业的成本粘性较低。

引用次数: 0

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