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Full-Text Articles in Business
Trust In Fair Value Accounting: Evidence From The Field, Clarence Goh, Chu Yeong Lim, Jeffery Ng, Gary Pan, Kevin Ow Yong
Trust In Fair Value Accounting: Evidence From The Field, Clarence Goh, Chu Yeong Lim, Jeffery Ng, Gary Pan, Kevin Ow Yong
Research Collection School Of Accountancy
We survey stakeholders in the financial reporting process to examine trust in fair value accounting. Although respondents demonstrate high confidence in financial statements, they believe that fair value accounting decreases trust in financial reporting and that preparing fair value numbers is costly but beneficial. They also strongly believe in the Conceptual Framework underlying standard setting. Using multivariate regression analyses, we find that perceiving fair value accounting as beneficial is positively associated with trust in it, consistent with the theory of reasoned action that people engage in behavior (e.g., trust) based on expected positive outcomes of that behavior. We find that …
Auditor Choice And Information Asymmetry: Evidence From International Syndicated Loans, Zhiming Ma, Derrald Stice, Rencheng Wang
Auditor Choice And Information Asymmetry: Evidence From International Syndicated Loans, Zhiming Ma, Derrald Stice, Rencheng Wang
Research Collection School Of Accountancy
Analyzing a large sample of non-US public firms from 31 countries that obtain private loans, we find that loan syndicates that lend to borrowers that employ Big N auditors are larger and less concentrated and that the lead arrangers and largest investors of these syndicates are able to hold a lower proportion of the loan after issuance. Further analysis demonstrates that this effect exists only in countries with strong creditor rights and in those countries with high levels of societal trust, suggesting that both sound formal and informal institutional factors are prerequisites for lenders and borrowers to benefit from differential …
Effects Of Informal Institutions On The Relationship Between Accounting Measures Of Risk And Bank Distress, Kiridaran Kanagaretnam, Jimmy Lee, Chee Yeow Lim, Gerald J. Lobo
Effects Of Informal Institutions On The Relationship Between Accounting Measures Of Risk And Bank Distress, Kiridaran Kanagaretnam, Jimmy Lee, Chee Yeow Lim, Gerald J. Lobo
Research Collection School Of Accountancy
We investigate the effects of informal institutions (trust, religiosity and the media) on the relationship between accounting-based risk measures and bank distress. We conduct our analysis in two stages. In the first stage, we extend the prior literature by documenting a link between accounting-based risk measures and bank distress during the 2008-2009 financial crisis. In particular, given the environment characterized by rapid growth in financial innovation and complex financial transactions prior to the crisis, simple accounting-based risk measures continue to predict bank distress during this crisis period. In the second stage, we address our main research question related to the …
In Fair Value We Trust, Or Not, Joyce Tang, Nick Leong, Pan, Gary, Keng Kevin Ow Yong, Chu Yeong Lim, Tee Yong Jeffrey Ng
In Fair Value We Trust, Or Not, Joyce Tang, Nick Leong, Pan, Gary, Keng Kevin Ow Yong, Chu Yeong Lim, Tee Yong Jeffrey Ng
Research Collection School Of Accountancy
The objective of financial reporting is to provide financial information that is useful to existing and potential investors, lenders and other creditors (IASB’s Conceptual Framework ED/2015/3). General purpose financial reports provide information about the financial position of a reporting entity, as well as information about the effects of transactions and other events that will change a reporting entity’s economic resources and claims (para 1.12 ED/2015/3). Investor confidence and trust in the financial statements is a crucial component for financial markets to function smoothly. This report presents the attitudes and concerns of over 700 respondents toward fair value accounting. The survey …
Societal Trust And Corporate Tax Avoidance, Kiridaran Kanagaretnam, Jimmy Lee, Chee Yeow Lim, Gerald J. Lobo
Societal Trust And Corporate Tax Avoidance, Kiridaran Kanagaretnam, Jimmy Lee, Chee Yeow Lim, Gerald J. Lobo
Research Collection School Of Accountancy
Using an international sample of firms and a country-level index for societal trust, we study how differences in trust across countries relate to corporate tax avoidance. Consistent with our prediction, we find strong evidence that societal trust is negatively associated with corporate tax avoidance by firms, even after controlling for other determinants such as home country tax system characteristics. We also explore the effects of three country-level institutional characteristics – level of investor protection, disclosure requirement, and tax enforcement – on the relation between societal trust and tax avoidance. We predict and find that the effects of trust on tax …