Pub Date : 2025-06-21DOI: 10.1016/j.bar.2025.101689
Paul Lavery, Kevin Amess, Marina-Eliza Spaliara
Prior empirical investigations of private equity activity indicates that it is concentrated in central financial hubs. Using comprehensive UK data on deal valuations, companies’ financial performance, and estimates of returns on buyout transactions, we study regional variations in deal pricing, portfolio firm performance, and deal returns. Our findings show that PE sponsors pay higher valuations for buyout targets in London and the South East relative to other UK regions. However, portfolio companies located in London and the South East do not exhibit greater gains in productivity and operating performance than their peers in peripheral regions. Our results also suggest that buyout returns are similar across UK regions.
{"title":"Private equity buyout pricing, returns, and portfolio firm performance across UK regions","authors":"Paul Lavery, Kevin Amess, Marina-Eliza Spaliara","doi":"10.1016/j.bar.2025.101689","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101689","url":null,"abstract":"Prior empirical investigations of private equity activity indicates that it is concentrated in central financial hubs. Using comprehensive UK data on deal valuations, companies’ financial performance, and estimates of returns on buyout transactions, we study regional variations in deal pricing, portfolio firm performance, and deal returns. Our findings show that PE sponsors pay higher valuations for buyout targets in London and the South East relative to other UK regions. However, portfolio companies located in London and the South East do not exhibit greater gains in productivity and operating performance than their peers in peripheral regions. Our results also suggest that buyout returns are similar across UK regions.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"35 1","pages":"101689"},"PeriodicalIF":0.0,"publicationDate":"2025-06-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144513195","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-06-03DOI: 10.1016/j.bar.2025.101688
Luis Otero González, Pablo Durán Santomil, Darine Marouf, João Paulo Vieito
This study explores the impact of mutual fund ratings on performance, risk, and net flow, with a particular focus on the persistence of performance in mutual funds across global emerging markets. Drawing on a comprehensive sample of equity mutual funds from 2000 to 2020, the research employs panel data regression models and advanced analytical techniques to uncover key insights.
{"title":"Are ratings and past performance good predictors of future performance in emerging markets mutual funds?","authors":"Luis Otero González, Pablo Durán Santomil, Darine Marouf, João Paulo Vieito","doi":"10.1016/j.bar.2025.101688","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101688","url":null,"abstract":"This study explores the impact of mutual fund ratings on performance, risk, and net flow, with a particular focus on the persistence of performance in mutual funds across global emerging markets. Drawing on a comprehensive sample of equity mutual funds from 2000 to 2020, the research employs panel data regression models and advanced analytical techniques to uncover key insights.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"11 1","pages":"101688"},"PeriodicalIF":0.0,"publicationDate":"2025-06-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144290144","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-05-23DOI: 10.1016/j.bar.2025.101685
Muhammad Farhan Malik, Yuan George Shan, Jamie Yixing Tong, Frank Feida Zhang
We investigate the impact of the board risk committee (BRC) on upward tone management in risk factor disclosures (RFD). Based on a sample of U.S. listed financial firms from 2005 to 2019, we find that the presence of a BRC is associated with less upward tone management in RFD, suggesting that BRCs enhance risk governance oversight and constrain managers from strategically biasing disclosure tone. BRCs' impact on mitigating upward tone management holds across different categories of risk disclosures. Further analysis shows that BRC size, independence, and the proportion of financial expert directors are negatively associated with upward tone in RFD, highlighting the importance of BRCs' structural factors. BRCs also improve disclosure readability while reducing uncertainty and ambiguity. Moreover, our cross-sectional analyses indicate that both mandatory and voluntary BRC adoption contribute to lower upward tone in RFD. However, this effect is significant only in the post-Dodd-Frank Act period, suggesting strengthened risk oversight following the Act's implementation. Finally, difference-in-differences tests provide further assurance against endogeneity concerns. Overall, our findings suggest that BRCs play a crucial role in curbing managerial incentives to manipulate RFD language, ultimately improving the quality of risk disclosures.
{"title":"Board risk committees and risk factor disclosures tone","authors":"Muhammad Farhan Malik, Yuan George Shan, Jamie Yixing Tong, Frank Feida Zhang","doi":"10.1016/j.bar.2025.101685","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101685","url":null,"abstract":"We investigate the impact of the board risk committee (BRC) on upward tone management in risk factor disclosures (RFD). Based on a sample of U.S. listed financial firms from 2005 to 2019, we find that the presence of a BRC is associated with less upward tone management in RFD, suggesting that BRCs enhance risk governance oversight and constrain managers from strategically biasing disclosure tone. BRCs' impact on mitigating upward tone management holds across different categories of risk disclosures. Further analysis shows that BRC size, independence, and the proportion of financial expert directors are negatively associated with upward tone in RFD, highlighting the importance of BRCs' structural factors. BRCs also improve disclosure readability while reducing uncertainty and ambiguity. Moreover, our cross-sectional analyses indicate that both mandatory and voluntary BRC adoption contribute to lower upward tone in RFD. However, this effect is significant only in the post-Dodd-Frank Act period, suggesting strengthened risk oversight following the Act's implementation. Finally, difference-in-differences tests provide further assurance against endogeneity concerns. Overall, our findings suggest that BRCs play a crucial role in curbing managerial incentives to manipulate RFD language, ultimately improving the quality of risk disclosures.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"5 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2025-05-23","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144237686","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-05-16DOI: 10.1016/j.bar.2025.101682
Suwan(Cheng) Long, Ying Xie, Zhengyuan Zhou, Brian Lucey, Andrew Urquhart
This paper examines the relationship between cryptocurrency market dynamics and investor sentiment, employing advanced techniques like time-variant Granger causality and asymmetric time-varying parameter vector autoregression (TVP-VAR) frequency connectivity. We create unique sentiment analysis tools, including a custom cryptocurrency sentiment lexicon, to deeply analyze content in the cryptocurrency domain, particularly focusing on investor discussions and viewpoints. Our findings demonstrate a significant, evolving link between market sentiment and cryptocurrency movements. A key observation is that the volatility of shock transmission is tightly connected to major market events, often influenced by large-scale investors, or “whales”. Our study indicates that market sentiment consistently affects both short- and long-term cryptocurrency volatility, underlining the crucial influence of investor sentiment in driving the dynamics of the cryptocurrency market. This underscores the importance of understanding investor sentiment for predicting and navigating the cryptocurrency market.
{"title":"From whales to waves: Social media sentiment, volatility, and whales in cryptocurrency markets","authors":"Suwan(Cheng) Long, Ying Xie, Zhengyuan Zhou, Brian Lucey, Andrew Urquhart","doi":"10.1016/j.bar.2025.101682","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101682","url":null,"abstract":"This paper examines the relationship between cryptocurrency market dynamics and investor sentiment, employing advanced techniques like time-variant Granger causality and asymmetric time-varying parameter vector autoregression (TVP-VAR) frequency connectivity. We create unique sentiment analysis tools, including a custom cryptocurrency sentiment lexicon, to deeply analyze content in the cryptocurrency domain, particularly focusing on investor discussions and viewpoints. Our findings demonstrate a significant, evolving link between market sentiment and cryptocurrency movements. A key observation is that the volatility of shock transmission is tightly connected to major market events, often influenced by large-scale investors, or “whales”. Our study indicates that market sentiment consistently affects both short- and long-term cryptocurrency volatility, underlining the crucial influence of investor sentiment in driving the dynamics of the cryptocurrency market. This underscores the importance of understanding investor sentiment for predicting and navigating the cryptocurrency market.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"56 1","pages":"101682"},"PeriodicalIF":0.0,"publicationDate":"2025-05-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144133695","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-05-03DOI: 10.1016/j.bar.2025.101650
Yi Cao, Wei Zhang
The special issue on Artificial Intelligence (AI) in Accounting and Finance explores how AI technologies are transforming the fields of accounting and finance, examining both their practical applications and the associated challenges. The papers included in this issue demonstrate how AI can improve efficiency, enhance decision-making processes, and increase transparency across various domains, including financial reporting, auditing, risk management, and taxation. Specifically, the contributions highlight AI’s capability to automate routine tasks, analyse large and complex datasets, and significantly improve predictive accuracy. However, despite these notable benefits, the adoption of AI also raises important ethical and regulatory concerns. Issues such as algorithmic bias, fairness, and accountability must be carefully addressed to ensure that AI technologies are implemented responsibly and ethically. Beyond reviewing current developments, this special issue also outlines several priorities for future research. These include improving the transparency and explainability of AI models, and expanding AI applications into areas that have received less attention, such as behavioural finance, taxation, and data valuation. By encouraging further research and promoting interdisciplinary collaboration, this special issue aims to guide the development of AI in ways that are both innovative and responsible. The ultimate goal is to create an accounting and finance ecosystem that is not only more efficient, but also ethical and sustainable.
{"title":"How AI is shaping accounting and finance","authors":"Yi Cao, Wei Zhang","doi":"10.1016/j.bar.2025.101650","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101650","url":null,"abstract":"The special issue on Artificial Intelligence (AI) in Accounting and Finance explores how AI technologies are transforming the fields of accounting and finance, examining both their practical applications and the associated challenges. The papers included in this issue demonstrate how AI can improve efficiency, enhance decision-making processes, and increase transparency across various domains, including financial reporting, auditing, risk management, and taxation. Specifically, the contributions highlight AI’s capability to automate routine tasks, analyse large and complex datasets, and significantly improve predictive accuracy. However, despite these notable benefits, the adoption of AI also raises important ethical and regulatory concerns. Issues such as algorithmic bias, fairness, and accountability must be carefully addressed to ensure that AI technologies are implemented responsibly and ethically. Beyond reviewing current developments, this special issue also outlines several priorities for future research. These include improving the transparency and explainability of AI models, and expanding AI applications into areas that have received less attention, such as behavioural finance, taxation, and data valuation. By encouraging further research and promoting interdisciplinary collaboration, this special issue aims to guide the development of AI in ways that are both innovative and responsible. The ultimate goal is to create an accounting and finance ecosystem that is not only more efficient, but also ethical and sustainable.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"35 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2025-05-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143930699","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We examine the relationship between corporate site visits by institutional investors and the provision of trade credit to these firms by their suppliers and find a positive relationship between the frequency of site visits and the level of supplier trade credit. This relationship is more pronounced among firms with less transparent information environments and greater financial constraints. The findings suggest that corporate site visits reduce information asymmetry and mitigate credit risks by curbing excessive managerial risk-taking, thereby increasing suppliers’ willingness to provide trade credit. Further, a textual analysis of the communications exchanged during corporate site visits reveals a stronger relationship between corporate site visits and trade credit when more information pertaining to the supply chain is disclosed during these visits. The results are robust to a variety of robustness checks for potential endogeneity. This research enriches the literature on the role of information quality in supply-chain finance. It sheds light on the broader implications of corporate site visits on intra-firm stakeholder dynamics.
{"title":"Suppliers’ response to corporate site visits at customers firms","authors":"Yingwen Guo, Jingjing Li, Bing-Xuan Lin, Weiyin Zhang","doi":"10.1016/j.bar.2025.101678","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101678","url":null,"abstract":"We examine the relationship between corporate site visits by institutional investors and the provision of trade credit to these firms by their suppliers and find a positive relationship between the frequency of site visits and the level of supplier trade credit. This relationship is more pronounced among firms with less transparent information environments and greater financial constraints. The findings suggest that corporate site visits reduce information asymmetry and mitigate credit risks by curbing excessive managerial risk-taking, thereby increasing suppliers’ willingness to provide trade credit. Further, a textual analysis of the communications exchanged during corporate site visits reveals a stronger relationship between corporate site visits and trade credit when more information pertaining to the supply chain is disclosed during these visits. The results are robust to a variety of robustness checks for potential endogeneity. This research enriches the literature on the role of information quality in supply-chain finance. It sheds light on the broader implications of corporate site visits on intra-firm stakeholder dynamics.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"38 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2025-05-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143930697","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-04-30DOI: 10.1016/j.bar.2025.101681
Zixuan Dai, Lei Xu, Chandrasekhar Krishnamurti, Zenghua Lu
We examine the effects of negative interest rate policy (NIRP) on the scale of shadow banking. Utilising a Triple Differences (TD) model and a cross-country dataset of 676 non-bank financial intermediaries from 28 OECD countries over the period 2011–2017, we observe a reduction in the size of shadow banking entities. Moreover, the impact of NIRP is heterogeneous based on country- and entity-specific characteristics such as inflation, entity size, and specialisation. Larger entities in moderate to high inflation environments tend to experience more significant size contractions. Our findings remain robust across various tests.
{"title":"Negative interest rates and shadow banking","authors":"Zixuan Dai, Lei Xu, Chandrasekhar Krishnamurti, Zenghua Lu","doi":"10.1016/j.bar.2025.101681","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101681","url":null,"abstract":"We examine the effects of negative interest rate policy (NIRP) on the scale of shadow banking. Utilising a Triple Differences (TD) model and a cross-country dataset of 676 non-bank financial intermediaries from 28 OECD countries over the period 2011–2017, we observe a reduction in the size of shadow banking entities. Moreover, the impact of NIRP is heterogeneous based on country- and entity-specific characteristics such as inflation, entity size, and specialisation. Larger entities in moderate to high inflation environments tend to experience more significant size contractions. Our findings remain robust across various tests.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"9 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2025-04-30","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143930698","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-04-28DOI: 10.1016/j.bar.2025.101676
Sylvia Dempsey, Carol Linehan, Margaret Healy
As labour markets shift responsibility for navigating career transitions and employability from organisations to individuals, sensemaking around their own ‘perceived employability’ gains importance. Prior research suggests work integrated learning (WIL) experiences constitute a significant route to perceived employability for potential entrants to the accounting profession. The mechanisms through which this develops are less understood. Understanding of the impact of WIL on perceived employability, shaping individual career trajectories, augments efforts to attract new members to the profession.
{"title":"Negotiating perceived employability as sensemaking in the context of undergraduate work integrated learning","authors":"Sylvia Dempsey, Carol Linehan, Margaret Healy","doi":"10.1016/j.bar.2025.101676","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101676","url":null,"abstract":"As labour markets shift responsibility for navigating career transitions and employability from organisations to individuals, sensemaking around their own ‘perceived employability’ gains importance. Prior research suggests work integrated learning (WIL) experiences constitute a significant route to perceived employability for potential entrants to the accounting profession. The mechanisms through which this develops are less understood. Understanding of the impact of WIL on perceived employability, shaping individual career trajectories, augments efforts to attract new members to the profession.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"43 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2025-04-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143901713","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-04-25DOI: 10.1016/j.bar.2025.101671
Hasibul Chowdhury, Hien Duc Han, Chandrasekhar Krishnamurti, Jiayi Zheng
This study examines the impact of institutional shareholder distraction on a firm's ability to maintain a safe workplace environment. By utilising extreme returns of firms in unrelated industries of institutional shareholders' portfolios as exogenous indicators of investor distraction, we demonstrate that institutional investor distraction is associated with a higher incidence of workplace injuries. A one standard deviation increase in the institutional distraction measure is associated with an increase of about 11.16 % in injury rates compared to the mean injury rate. Our channel tests indicate that this negative relation between institutional distraction and workplace safety results from reduced monitoring efforts by distracted institutional investors, fostering managerial short-termism. Our baseline finding remains consistent across a series of robustness and endogeneity tests. Cross-sectional analysis reveals that the association between institutional distraction and workplace injuries is more pronounced in companies with weaker governance and greater information asymmetry.
{"title":"Institutional shareholder distraction and workplace safety","authors":"Hasibul Chowdhury, Hien Duc Han, Chandrasekhar Krishnamurti, Jiayi Zheng","doi":"10.1016/j.bar.2025.101671","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101671","url":null,"abstract":"This study examines the impact of institutional shareholder distraction on a firm's ability to maintain a safe workplace environment. By utilising extreme returns of firms in unrelated industries of institutional shareholders' portfolios as exogenous indicators of investor distraction, we demonstrate that institutional investor distraction is associated with a higher incidence of workplace injuries. A one standard deviation increase in the institutional distraction measure is associated with an increase of about 11.16 % in injury rates compared to the mean injury rate. Our channel tests indicate that this negative relation between institutional distraction and workplace safety results from reduced monitoring efforts by distracted institutional investors, fostering managerial short-termism. Our baseline finding remains consistent across a series of robustness and endogeneity tests. Cross-sectional analysis reveals that the association between institutional distraction and workplace injuries is more pronounced in companies with weaker governance and greater information asymmetry.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"24 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2025-04-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143901712","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-04-24DOI: 10.1016/j.bar.2025.101672
Benjamin Hammer, Nikolaus Marcotty-Dehm, Jens Martin
This paper examines differences in the disclosure and efficacy of intended use of proceeds between private equity (PE)-backed and non-PE-backed initial public offerings (IPOs). We find that PE-backed issuers have a significantly higher (lower) probability of disclosing “repayment of debt” and “repayment to selling shareholders” (“M&A”) than non-PE-backed issuers. Moreover, PE-backed issuers that disclose “repayment of debt” deleverage significantly more post-IPO to reduce their above-average debt-to-asset ratios to the level of non-PE-backed issuers. This is consistent with the idea that leveraged buyouts do not lead to a sustained change in optimal capital structure. While non-PE-backed issuers that disclose “R&D” (“M&A”) increase their R&D intensity (M&A deal volume) post-IPO, PE-backed issuers do not. Our results suggest that this is due to a trade-off with the need to repay claimholders in PE-backed IPOs. Finally, we show that PE backing reduces underpricing only if the use-of-proceeds disclosure is vague. Hence, we provide evidence that the well-documented PE “certification effect” depends on the information content of the prospectus.
{"title":"Use of proceeds in private equity-backed initial public offerings","authors":"Benjamin Hammer, Nikolaus Marcotty-Dehm, Jens Martin","doi":"10.1016/j.bar.2025.101672","DOIUrl":"https://doi.org/10.1016/j.bar.2025.101672","url":null,"abstract":"This paper examines differences in the disclosure and efficacy of intended use of proceeds between private equity (PE)-backed and non-PE-backed initial public offerings (IPOs). We find that PE-backed issuers have a significantly higher (lower) probability of disclosing “repayment of debt” and “repayment to selling shareholders” (“M&A”) than non-PE-backed issuers. Moreover, PE-backed issuers that disclose “repayment of debt” deleverage significantly more post-IPO to reduce their above-average debt-to-asset ratios to the level of non-PE-backed issuers. This is consistent with the idea that leveraged buyouts do not lead to a sustained change in optimal capital structure. While non-PE-backed issuers that disclose “R&D” (“M&A”) increase their R&D intensity (M&A deal volume) post-IPO, PE-backed issuers do not. Our results suggest that this is due to a trade-off with the need to repay claimholders in PE-backed IPOs. Finally, we show that PE backing reduces underpricing only if the use-of-proceeds disclosure is vague. Hence, we provide evidence that the well-documented PE “certification effect” depends on the information content of the prospectus.","PeriodicalId":501001,"journal":{"name":"The British Accounting Review","volume":"8 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2025-04-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143930700","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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