סמינר במימון חשבונאות -: The Changing Relevance of Accounting Numbers to Debt Holders over Time

Speaker: Dr. Sharon Katz. Columbia University

 

28 באוגוסט 2013, 11:45 - 17:00 

Recanati Building, room 430 

Abstract

We examine the change over time in the information content of accounting numbers from the

perspective of bondholders and the causes for this change. Using proprietary longitudinal data,

we find that, in contrast to the decline in the information content of accounting numbers to equity

holders over time, the information content to bondholders has held steady or risen. The rise is

attributable to economic factors such as an increase in risk and in the frequency of unfavorable

news to which the valuation of debt is more sensitive than that of equity. There are indications,

however, that reporting factors, specifically an increase in conservatism over the last four

decades, is associated with this rise. The findings contribute to the scant literature on the use of

financial information by bondholders and the extent to which financial reporting meets their

unique information needs. Given debt holders prominence as users of financial statements, the

findings have important implications for accounting standard setting