Boarding a Sinking Ship? An Investigation of Job Applications to Financially Distressed Firms

2012 ◽  
Author(s):  
Jennifer Brown ◽  
David A. Matsa
Keyword(s):  
Distressed Firms ◽  
Financially Distressed

Financial Distress, Earnings Benchmark and Earnings Management Practices

2021 ◽  
pp. 097226292110109
Author(s):  
Karan Gandhi
Keyword(s):  
Panel Data ◽  
Earnings Management ◽  
Financial Distress ◽  
Management Practices ◽  
Real Earnings Management ◽  
Public Companies ◽  
Large Panel ◽  
Distressed Firms ◽  
Contradictory Evidence ◽  
Financially Distressed

Prior research exhibits contradictory evidence on earnings management practices, both accrual and real, undertaken by the firms in state of financial distress. This study uniquely examines the issue in the presence of earnings-increasing earnings management motivation- meeting earnings benchmark of avoiding losses. For examining the issue, this study analyzes large panel data of Indian public companies for the period 2000–2016. The findings indicate prevalence of earnings-decreasing real earnings management practices, that is, decrease in overproduction and increase in spending on discretionary expenses, in financially distressed firms despite there being motivation to increase earnings to avoid losses. No evidence of accrual earnings management practices has been observed in such firms.

Asset sales by financially distressed firms

1994 ◽  
Vol 1 (2) ◽  
pp. 233-257 ◽  
Author(s):  
David T. Brown ◽  
Christopher M. James ◽  
Robert M. Mooradian
Keyword(s):  
Asset Sales ◽  
Distressed Firms ◽  
Financially Distressed

scholarly journals Spreading the Misery? Sources of Bankruptcy Spillover in the Supply Chain

2016 ◽  
Vol 51 (6) ◽  
pp. 1955-1990 ◽  
Author(s):  
Madhuparna Kolay ◽  
Michael Lemmon ◽  
Elizabeth Tashjian
Keyword(s):  
Supply Chain ◽  
Trade Credit ◽  
Market Value ◽  
Trading Partners ◽  
Distressed Firms ◽  
Financially Distressed ◽  
The Cost

We document that suppliers to purely financially distressed companies that are highly likely to reorganize in bankruptcy incur little or no spillover costs. In contrast, suppliers to economically distressed firms experience large losses in market value that are linked to proxies for the cost of replacing the bankrupt customers. Suppliers experience increased selling, general, and administrative (SG&A) expenses and lower margins in the year following the bankruptcy of their trading partners, which we link to proxies for partner replacement costs. Suppliers continue to extend trade credit to firms that are healthier and in situations where the cost of replacing the partner is higher.

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