.
Do State Ownership and Political Connections Affect Precautionary Cash Holdings for Customer Concentration? Evidence from China
This paper examines whether state ownership and political connections affect the relationship between customer concentration and cash holdings for Chinese listed manufacturing firms. We show that non-state-owned firms, but not state-owned firms, hold more cash as customer concentration increases. In addition, political connections weaken the positive effect of customer concentration on non-state-owned firms’ cash holdings. Our supplemental analyses further show that for non-state-owned firms with limited access to finance—for instance, firms with low analyst following, low institutional ownership, or low government subsidies—the effects of political connections on weakening the positive association between customer concentration and cash holdings are more pronounced. Additional robustness tests support our arguments.
Analysts’ Earnings per Share Forecasts: The Effects of Forecast Uncertainty and Forecast Precision on Investor Judgements
This study uses controlled experiments to investigate the joint effects of forecast uncertainty and forecast precision on investor judgements. It finds that forecast precision moderates the effects of forecast uncertainty on investors’ forecast reliability judgements such that the effects of forecast uncertainty on investors’ judgements of forecast reliability are more negative when an analyst's point earnings per share (EPS) forecast is rounded than when it is precise. In addition, the relationship between forecast precision and investors’ judgements of forecast reliability is mediated by investors’ perceptions of forecast attributes. The evidence also suggests that while forecast uncertainty exerts a negative effect on investment judgements, forecast precision does not play a role in mitigating these negative effects. Using a supplementary within-participants experiment, the study further finds that investors may not be consciously aware of how forecast precision influences their judgements of forecast reliability.
The role of customer and expert ratings in a hedonic analysis of French red wine prices: from gurus to geeks?
.
Digital financial inclusion and green growth: analysis of Chinese agriculture
.
Are the drivers of structural change different in Asia and Africa?
.
Dynamic analysis of healthcare providers’ cost efficiency
.
Investor reactions to key audit matters: Financial and non‐financial contexts
Abstract
We investigate how a disclosed risk item and key audit matter (KAM) relatedness combine to affect investors' riskiness assessment in financial and non-financial contexts. When management disclose a high-risk item, we find that investors react the same way across contexts with KAM relatedness having no effect. When management disclose a low-risk item, investors react differently in each context. When a KAM is related to the disclosed financial (non-financial) low-risk item, investors assess investment riskiness higher (lower) than when a KAM is unrelated to the low-risk item. Our findings indicate the varying communicative value of KAMs across financial and non-financial contexts.
Too transparent for signalling? A global analysis of bond issues by property companies
Abstract
Bond issues often result in negative revaluations of the market value of equity. These market reactions are usually explained by negative signals and asymmetric information about the use of the proceeds. In industries with rather transparent investment opportunities these arguments are not applicable and we expect to find no negative revaluations. Consequently, analysing the stock price reactions to 2299 bond issues by real estate companies between 1996 and 2019, we observe none to positive reactions on the announcement of an upcoming bond issue. The findings underpin the necessity for controlling of industry effects in empirical studies on capital structure decisions.
The response of Australian firms to AASB 138 disallowing the recognition of internally generated identifiable intangibles
Abstract
This paper responds to a call by the Australian Accounting Standards Board to investigate how Australian firms responded to a perceived loss of information pursuant to AASB 138 (IAS38) which mandated the de-recognition of previously recognised internally generated identifiable intangibles, from its effective date of 1 January 2005. We find that the sample firms did not choose to provide alternative or substitute disclosure elsewhere in their annual report or financial statements anytime during our sample period (2005–2010). Prima facie, this is surprising given prior evidence from the value relevance literature that disclosures relevant to the value of internally generated intangibles are correlated with firm value and presumably informative for investors. However, we caution against the drawing of simple conclusions that this finding implies alternative disclosure may not be valuable. Rather, it is important to understand the forces or frictions that contribute to this result. Schipper (The Accounting Review, 82, 2007, 301) and Skinner (Accounting and Business Research, 38, 2008, 191) offer valuable insights into the potential issues such as the costs of alternative disclosure including proprietary costs of disclosing competitive information and, the lower credibility of financial disclosures outside of audited financial statements. These are important considerations in the on-going standard-setting debate on recognition versus disclosure of value relevant information on intangible assets.