scholarly journals Do ownership structure and quality of financial information affect the cost of debt of Tunisian listing firms?

2017 ◽  
Vol 9 (2) ◽  
pp. 140
Author(s):  
Aida Sy ◽  
Lamia Jamel ◽  
Abdelkader Derbali
Keyword(s):  
Ownership Structure ◽  
Financial Information ◽  
Cost Of Debt ◽  
The Cost

Ownership Structure, Antitakeover Provisions, and the Cost of Debt

2020 ◽  
Author(s):  
Yuzi Chen ◽  
Jun-Koo Kang ◽  
Jungmin Kim ◽  
Hyun Seung Na
Keyword(s):  
Ownership Structure ◽  
Cost Of Debt ◽  
The Cost

scholarly journals Ownership Structure and earnings management: Empirical evidence from listed pharmaceuticals and chemical firms of Bangladesh

2020 ◽  
Vol 5 (2) ◽  
pp. 58-69
Author(s):  
Dewan Azmal Hossain
Keyword(s):  
Earnings Management ◽  
Empirical Evidence ◽  
Ownership Structure ◽  
Good Governance ◽  
Foreign Ownership ◽  
Jel Classification ◽  
Financial Information ◽  
Least Square ◽  
The Relationship

Objective – This study aims to examine the relationship between ownership structure (determined by institutional and foreign ownership) and earnings management in the context of Bangladeshi Pharmaceuticals and Chemical firms. Methodology/Technique – Out of 32 listed firms, this study examined 29 firms from the pharmaceuticals and chemical industry of Bangladesh from 2014 to 2018. Three firms are omitted as they got listed in 2018 and 2019 respectively. This study uses discretionary working capital accrual to measure earnings management that is the dependent variable. Ordinary least square regression analysis is conducted to assess the result of this study. Institutional and foreign ownership are independent variables. ROA, size, cash flow from operation, and leverage are control variables. Findings – It is found that institutional ownership is negatively related to earnings management and foreign ownership is positively related to earnings management but none of them are statistically significant indicating institutional and foreign ownership do not help in resolving or reducing the earnings management problems in the context of Bangladeshi pharmaceuticals and chemical firms. Novelty – Previous studies in Bangladesh deal only with the techniques of earnings management. To my knowledge, it is the first study that tries to assess the relationship of ownership structure defined by institutional and foreign shareholdings with earnings management in the context of Bangladeshi pharmaceuticals and chemical firms. These two ownership patterns are selected because they are supposed to increase the quality of financial information and also because in Bangladesh state and general shareholders are too dispersed to monitor the governance issues. The practical implications of this study is that investors should not consider institutional and foreign ownership percentage as a determining factor of good governance when considering investment decisions rather should look for other firm-specific factors as institutional and foreign shareholders are found to be inactive in increasing the quality of financial information in the context of Bangladesh. Policymakers should identify why institutional and foreign shareholders are not active and should revise the governance mechanisms accordingly. Type of Paper: Empirical Keywords: Ownership structure; Institutional Shareholdings; Foreign Shareholdings; Earnings Management; Bangladesh. Reference to this paper should be made as follows: Hossain, D.A. 2020. Ownership Structure and earnings management: Empirical evidence from listed pharmaceuticals and chemical firms of Bangladesh, J. Fin. Bank. Review, 5 (2): 58 – 69 https://doi.org/10.35609/jfbr.2020.5.2(3) JEL Classification: G40; G41; G49.

Business group affiliation, ownership structure, and the cost of debt

2013 ◽  
Vol 23 ◽  
pp. 311-331 ◽  
Author(s):  
Hae-Young Byun ◽  
Sunhwa Choi ◽  
Lee-Seok Hwang ◽  
Robert G. Kim
Keyword(s):  
Ownership Structure ◽  
Business Group ◽  
Cost Of Debt ◽  
Group Affiliation ◽  
Business Group Affiliation ◽  
The Cost

Transaction-based lending and accrual quality

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Stephen Gray ◽  
Arjan Premti
Keyword(s):  
Earnings Quality ◽  
Financial Statements ◽  
Financial Statement ◽  
Cost Of Debt ◽  
Accrual Quality ◽  
Content Type ◽  
Income Statement ◽  
Prior Literature ◽  
The Cost

PurposeThis study examines how lenders modify their behavior and their use of traditional, transaction-based lending models in credit decisions when faced with low earnings quality.Design/methodology/approachTo measure the earnings quality, following Bharath, Sunder and Sunder (2008), the authors use three measures of accrual quality and combine them into a simple parsimonious measure of accrual quality. Subsequently, the authors apply the incremental R-square approach used by Kim and Kross (2005) to determine the degree to which lenders modify their reliance on financial statement ratios when faced with low accrual quality.FindingsConsistent with prior literature, this study shows that the cost of debt is higher when accrual quality is low. In addition, this study extends prior literature by showing that lenders decrease their reliance on income statement data to make credit decisions as accrual quality decreases.Originality/valueThis paper broadens existing literature on the pricing of information risk in capital markets by being the first to show that lenders modify their reliance on financial statement data when faced with low-quality accruals. In addition, this paper extends the findings of Billings and Morton (2002) and demonstrates to managers the futility of using accrual manipulations to obtain more favorable credit terms. Lastly, this paper aids regulators and standard setters who seek to improve the usefulness of financial statements by showing that creditors do not appear to be misled by reporting choices that lower the quality of accruals.

Strategic Ownership Structure and the Cost of Debt

2012 ◽  
Vol 25 (7) ◽  
pp. 2257-2299 ◽  
Author(s):  
Hadiye Aslan ◽  
Praveen Kumar
Keyword(s):  
Ownership Structure ◽  
Cost Of Debt ◽  
The Cost

scholarly journals The Effect of Managerial Share Pledges on the Cost of Debt

2021 ◽  
Vol 50 (6) ◽  
pp. 617-650
Author(s):  
Soonhong Park ◽  
Hyeon Sook Kim ◽  
Byungkwon Lim
Keyword(s):  
Ownership Structure ◽  
Risk Taking ◽  
Risk Premium ◽  
Firm Value ◽  
Positive Relationship ◽  
Cost Of Debt ◽  
Controlling Shareholders ◽  
Managerial Risk ◽  
The Cost ◽  
The Relationship

We examines whether share pledges by controlling shareholders influence a firm’s cost of debt. We also investigate whether the relationship between share pledges and the cost of debt stems from the managerial risk-taking incentives or pursuing the private benefits of controlling shareholders. We make three major findings. First, we find the cost of debt is higher in firms with share pledges than in firms without share pledges. Furthermore, we identify a positive relationship between the cost of debt and the level of share pledges. Second, we find that there is no increased corporate financial leverage or investment activities in firms with share pledges. Finally, our empirical evidence demonstrates that the positive relationship between share pledges and cost of debt is more pronounced for lower foreign institutional investor stakes or higher controlling shareholders ownership. Overall, the results indicate that share pledges by controlling shareholders negatively affect the cost of debt. However, the effect of share pledges on the cost of debt is differently influenced by a firm’s ownership structure. Our findings suggest that share pledges induce stockholder-bondholder conflict, and the bondholder requires more risk premium due to the decrease of firm value.

scholarly journals Corporate Governance Index, Corporate Ownership Structure and Audit Committee on Debt Costs

2020 ◽  
Vol 1 (2) ◽  
Author(s):  
Siti Nur Azizah ◽  
Yulia Nurcahyani
Keyword(s):  
Corporate Governance ◽  
Ownership Structure ◽  
Audit Committee ◽  
Stock Exchange ◽  
Investment Decision ◽  
Linear Regression Analysis ◽  
Secondary Data ◽  
Cost Of Debt ◽  
Governance Index ◽  
The Cost

This study aims to analyze corporate governance index and ownership structure and audit committee on the cost of debt. The study based on agency theory by Jensen and Meckling in 1976. This study use secondary data derived from financial statements of companies participating in the Corporate Governance Perception Index (CGPI) for 2014-2018 which are listed on the Indonesia Stock Exchange. The method of data collection in this study used purposive sampling. The data was analyzed by multiple linear regression analysis. The results of this study indicate that corporate governance index and institutional ownership negatively effect on the cost of debt. In contrast, audit committee and managerial ownership has no impact on the cost of debt. The findings in this study can be beneficial for investors in assessing the governance of a company in managing its debt. Investors can consider for an investment decision both long term and short term.

Sign in / Sign up

Export Citation Format

Share Document