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1.
Corporate voluntary disclosure and the separation of cash flow rights from control rights 总被引:1,自引:1,他引:0
Kin-Wai Lee 《Review of Quantitative Finance and Accounting》2007,28(4):393-416
We find that corporate voluntary disclosure is negatively associated with the separation of cash flow rights from control
rights. This result is consistent with the notion that as the separation of cash flow rights from control rights increases,
controlling owners have larger incentives to expropriate the wealth of minority shareholders and low corporate disclosure
constitutes a mechanism to facilitate controlling owners in masking their private benefits of control. The negative association
between voluntary disclosure and the separation of cash flow rights from control rights is less pronounced for firms with
greater external financing needs. This result suggests that for firms with high separation of cash flow rights from control
rights, those with greater external financing needs undertake higher firm-level voluntary disclosure to reduce information
asymmetry. We also find that the negative association between voluntary disclosure and the separation of cash flow rights
from control rights is less pronounced for firms that have a large non-management shareholder. Our result supports the role
of large non-management shareholder in mitigating agency problems associated with the separation of ownership and control.
相似文献
Kin-Wai LeeEmail: |
2.
Derek K. Oler 《Review of Accounting Studies》2008,13(4):479-511
This paper investigates whether an acquirer’s pre-announcement cash level can predict post-acquisition returns. Harford (1999, Journal of Finance, 54, 1969–1997) shows that some cash-rich acquirers have lower announcement period returns than other acquirers, suggesting the
market partially anticipates poor future performance. This paper shows that the acquirer’s cash level is also strongly and
negatively predictive of post-acquisition returns, indicating that the announcement response is incomplete. Post-acquisition
return on net operating assets (RNOA) is significantly decreasing in acquirer cash, suggesting that the market responds to
subsequent poor operating performance as it is reported. Overall, these results are consistent with the market’s inattention
to a less prominent accounting signal (acquirer cash) but attentiveness to a more prominent accounting signal (RNOA), as proposed
by Hirshleifer and Teoh (2003, Journal of Accounting Economics, 36, 337–386).
相似文献
Derek K. OlerEmail: |
3.
William D. Terando Wayne H. Shaw David B. Smith 《Review of Quantitative Finance and Accounting》2007,29(3):223-240
This paper examines whether investors’ valuations of cash and share-put warrants are influenced by their potential differential
effect on firm solvency. It is motivated by the enactment of SFAS 150, which requires that all contingent put warrant obligations
be classified as balance sheet liabilities regardless of put type. Consistent with the critics of SFAS150, we show that market
participants differentially value cash and share-puts based on their solvency characteristics beyond the firm’s recorded assets
and liabilities. Our results add to existing capital structure literature by suggesting that complex financial instruments
(such as cash and share-puts) be reported separately from each other on a firm’s balance sheet.
相似文献
William D. TerandoEmail: |
4.
Corporate cash holdings: Evidence from Switzerland 总被引:1,自引:0,他引:1
Wolfgang Drobetz Matthias C. Grüninger 《Financial Markets and Portfolio Management》2007,21(3):293-324
This paper investigates the determinants of cash holdings for a comprehensive sample of Swiss non-financial firms between
1995 and 2004. The median Swiss firm holds almost twice as much cash and cash equivalents as the median US or UK firm. Our
results indicate that asset tangibility and firm size are both negatively related to corporate cash holdings, and that there
is a non-linear relationship between the leverage ratio and liquidity. Dividend payments and operating cash flows are positively
related to cash reserves, but we cannot detect a significant relationship between growth opportunities and cash holdings.
Most of these empirical findings, but not all of them, can be explained by the transaction costs motive and/or the precautionary
motive. Analyzing the corporate governance structures of Swiss firms, we document a non-linear relationship between managerial
ownership and cash holdings, indicating an incentive alignment effect and an opposing effect related to increasing risk aversion.
Finally, our results suggest that firms in which the CEO simultaneously serves as the COB hold significantly more cash.
相似文献
Matthias C. GrüningerEmail: |
5.
Seow Eng Ong Tien Foo Sing Alan Hwee Loon Teo 《The Journal of Real Estate Finance and Economics》2007,35(3):253-280
This paper extends the extant literature in understanding the effects of equity and debt on delinquency and default by focusing
on a variant of borrower equity where part of equity is “protected”. The CPF scheme in Singapore stipulates that the refund
of borrower’s retirement funds utilized for property purchase prior to September 2002 takes priority over loan obligations.
A decision to utilize CPF for property purchase actually increases ex post delinquency and default risk as it effectively
reduces cash equity commitment. In particular, any erosion in house value that places protected equity at risk translates
into potential wealth reduction or financial liability for the borrower. While loss aversion is evident for non-distressed
sellers, the effect of equity losses for distressed borrowers is not as clear. Our research suggests that averting losses
in committed equity may be a secondary consideration for borrower subject to income shocks, recognizing that delinquency and
default are precursors to foreclosure. Interestingly, we find that the borrowers are strongly averse to incurring protected
equity-induced wealth loss or financial liability. This study suggests that the first-lien “anomaly” associated with CPF refund
may reduce delinquency and default risks for mortgage backed securities.
相似文献
Seow Eng OngEmail: |
6.
Mine Ertugrul Özcan Sezer C. F. Sirmans 《The Journal of Real Estate Finance and Economics》2008,36(1):53-80
This paper studies the determinants of corporate hedging practices in the REIT industry between 1999 and 2001. We find a positive
significant relation between hedging and financial leverage, indicating the financial distress costs motive for using derivatives
in the REIT industry. Using estimates of the Black–Scholes sensitivity of CEO’s stock option portfolios to stock return volatility
and the sensitivity of CEO’s stock and stock option portfolios to stock price, we find evidence to support managerial risk
aversion motive for corporate hedging in the REIT industry. Our results indicate that CEO’s cash compensation and the CEO’s
wealth sensitivity to stock return volatility are significant determinants of derivative use in REITs. We also document a
significant positive relation between institutional ownership and hedging activity. Further, we find that probability of hedging
is related to economies of scale in hedging costs.
相似文献
C. F. SirmansEmail: |
7.
The Determinants of REIT Cash Holdings 总被引:1,自引:0,他引:1
William G. HardinIII Michael J. Highfield Matthew D. Hill G. Wayne Kelly 《The Journal of Real Estate Finance and Economics》2009,39(1):39-57
The factors influencing the cash holdings of REITs are examined with the view that the REIT industry should yield new information
regarding the drivers of corporate cash policy due to their unique operating conditions. The availability of REIT line of
credit data also allows us to test the association between cash holdings and line of credit access and use. Data constraints
in prior investigations have left this an unresolved empirical question in the cash holdings literature. The baseline results
show that REIT cash holdings are inversely related to funds from operations, leverage, and internal advisement and are directly
related to the cost of external finance and growth opportunities. Cash holdings are also negatively associated with credit
line access and use. The results imply that REIT managers elect to hold little cash to reduce the agency problems of cash
flow thereby increasing transparency and reducing the future cost of external capital.
相似文献
G. Wayne KellyEmail: |
8.
Do core and non-core cash flows from operations persist differentially in predicting future cash flows? 总被引:2,自引:0,他引:2
This study investigates the persistence of cash flow components (core and non-core cash flows) using a cash flow prediction
model. By extending the Barth, Cram, and Nelson (Account Rev 76(January):27–58, 2001) model, we examine the role of cash flow components in predicting future cash flows beyond that of accrual components. We
propose a cash flow prediction model that decomposes cash flows from operations into core and non-core cash flow components
that parallel the presentation and format of operating income from the income statement. Consistent with the AICPA and financial
analysts’ recommendations, and as predicted, we find that core and non-core cash flows defined in our paper are differentially
persistent in predicting future cash flows; and these cash flow components enhance the in-sample predictive ability of cash
flow prediction models. We also analyze the association of in-sample prediction errors with earnings, cash flow and accruals
variability. We find that disaggregating cash flows improve in-sample prediction, especially for large firms with high cash
flows and earnings variability.
相似文献
Dana Hollie (Corresponding author)Email: |
9.
Investment opportunities,free cash flow,and stock valuation effects of secured debt offerings 总被引:1,自引:1,他引:0
Shao-Chi Chang Sheng-Syan Chen Ailing Hsing Chia Wei Huang 《Review of Quantitative Finance and Accounting》2007,28(2):123-145
This paper examines the role of investment opportunities and free cash flow in explaining the source of the stock valuation
effects of secured debt offerings. We find a significantly positive relation between a firm's investment opportunities and
its stock price response to announcements of secured debt issues. This evidence supports the investment opportunities hypothesis
that secured debt financing is more valuable for issuing firms with high growth opportunities. In contrast, we find a lack
of support for the free cash flow hypothesis. These findings hold even after controlling for other potentially influential
variables. Our study provides a better understanding of the relative importance of various potential determinants in explaining
the variation in the valuation impact of secured debt issues.
相似文献
Chia Wei HuangEmail: |
10.
Hsuan-Chu Lin 《Review of Quantitative Finance and Accounting》2007,29(2):173-180
This paper identifies and corrects a typographical error in Black and Cox (J Finance 31:351–367, 1976). While the typographical error is seemingly trivial, the magnitude of the pricing error that it generates can be substantial.
相似文献
Hsuan-Chu LinEmail: |
11.
Christian Andres André Betzer Charlie Weir 《Financial Markets and Portfolio Management》2007,21(4):403-424
We examine shareholder wealth effects in a heterogeneous sample of 115 European leveraged going private transactions from
1997 to 2005. Average abnormal returns as reaction to the LBO announcement amount to 24.20%. In cross-sectional regressions,
we find that these value gains can largely be attributed to differences in corporate governance: on a macro level, abnormal
returns for pre-LBO shareholders are larger in countries with a poor protection of minority shareholders. On a firm level,
companies with a high pre-LBO free float and comparatively weak monitoring by shareholders tend to show high abnormal returns.
Furthermore, companies that are undervalued with respect to an industry peer-group exhibit higher announcement returns, indicating
that agency conflicts and/or market inefficiencies can serve as an explanation.
相似文献
Charlie WeirEmail: |
12.
We empirically examine how governance structure affects the design of executive compensation contracts and in particular, the implicit weights of firm performance measures in CEO’s compensation. We find that compensation contracts in firms with higher takeover protection and where the CEO has more influence on governance decisions put more weight on accounting-based measures of performance (return on assets) compared to stock-based performance measures (market returns). In additional tests, we further find that CEO compensation in these firms has lower variance and a higher proportion of cash (versus stock-based) compensation. We further find that CEOs’ incentives (measured as changes in CEO annual wealth which includes expected changes in the value of the CEO’s equity holdings in addition to yearly compensation) do not vary across governance structures. These findings are consistent with CEOs in firms with high takeover protection and where they have more influence on governance negotiating different contracts.
相似文献
Fernando PenalvaEmail: Phone: +34-93-2534200 |
13.
Shai Levi 《Review of Accounting Studies》2008,13(1):1-21
This study investigates firms’ decisions to disclose accruals information in earnings press releases versus to provide it
only in 10-Q filings and the impact of this disclosure on the pricing of accruals. I find that firms disclose accruals in
their press releases when earnings alone are a weak indication of cash flow performance and that following these disclosures
the accruals information is fully impounded into stock prices. The evidence suggests that when investor demand for accruals
is likely to exist and firms disclose the information in earnings press releases, the mispricing typically associated with
accruals is mitigated.
相似文献
Shai LeviEmail: |
14.
Why do firms repurchase stock to acquire another firm? 总被引:1,自引:0,他引:1
Robin S. Wilber 《Review of Quantitative Finance and Accounting》2007,29(2):155-172
This study investigates firms that repurchase their stock to finance an acquisition. Since research shows that cash-financed
acquisitions perform better than stock-financed acquisitions, why do firms that have available cash initiate the extra transactional
step. I find these firms are well compensated for their efforts, especially in the long run. On average, these firms have
negative abnormal returns prior to their repurchase announcements and thus may choose repurchasing to signal undervaluation.
Furthermore, the stock acquisition step allows these firms to share risk, counteract the negative effects of dilution, and
enjoy a tax advantage for their efforts.
相似文献
Robin S. WilberEmail: |
15.
Using the representative agent approach as in Kaplow (Am Econ Rev 82:1013–1017, 1992b), this paper shows that providing tax
deductions for the individual’s net losses is socially optimal when the insurer faces the risk of insolvency. We further show
that the government should adopt a higher tax deduction rate for net losses when the insurer is insolvent than when the insurer
is solvent. Thus, tax deductions for net losses could be used to provide an insurance for individuals against the insurer’s
risk of insolvency. These findings could also be used to explain why a government provides supplementary public insurance
or government relief. Finally, we discuss that, if the individuals are heterogeneous in terms of loss severity, loss probability,
or income level, providing a tax deduction for the individual’s net losses may not always achieve a Pareto improvement, and
cross subsidization should be taken into consideration.
相似文献
Larry Y. TzengEmail: |
16.
John J. Maher Robert M. Brown Raman Kumar 《Review of Quantitative Finance and Accounting》2008,31(2):167-189
We examine the valuation effects of overall demand for corporate equities combined with the influence of abnormal earnings
and unexpected funds flow. Our results indicate that the expected and unexpected net new total flow of funds into all stock
mutual funds do not by themselves have a meaningful effect on firm equity valuation. However, we find the combination of unexpected
funds flow and realized abnormal earnings have significant and important valuation effects. Importantly, the valuation impact
is greatest for those firms with high earnings growth potential that also operate in an environment characterized by high
information asymmetry.
相似文献
Raman KumarEmail: |
17.
Juerg Syz Paolo Vanini Marco Salvi 《The Journal of Real Estate Finance and Economics》2008,36(1):23-35
Economists have forcefully argued for the introduction and use of property derivatives as a hedge against house price risk
(e.g. Shiller and Weiss, J. Real Estate Finance Econ., 19(1):21–47, 1999). The rationale for these financial instruments seems clear, as many households are heavily invested in
housing and standard financial instruments offer a poor hedge. In practice, however, most of the property derivatives available
have been targeted to meet the needs of institutional investors, not those of owner-occupiers. Building on the recent launch
of the first Swiss property derivative, we here propose index-linked mortgages tailored to retail consumers. The payments
of these mortgages depend on the corresponding housing market performance. We further price the instruments, discuss the stabilization
of the homeowner’s net wealth, and quantify the expected decrease in the mortgage default risk achieved by this immunization
effect.
相似文献
Juerg SyzEmail: |
18.
Adverse selection is often blamed for the malfunctioning of the annuities market. We simulate the impact of adverse selection
on the consumption allocation of annuitants under alternative parameter values, and explore the resulting welfare implications.
We show that, for most parameter values, the welfare losses associated with equilibriums that are subject to adverse selection
correspond to a loss of wealth of around one percent in a first-best equilibrium. These losses are smaller than the corresponding
losses associated with equilibriums with no access to an annuity market by an order of magnitude of ten. The existence of
substitutes for annuities such as a bequest motive or a social security system intensifies the adverse selection but reduces
its welfare impact.
相似文献
Oded PalmonEmail: |
19.
This study investigates whether the association between ownership structure and leverage varies with the magnitude of growth
opportunities. According to the free cash flow hypothesis, managers receive utility from increasing firm size and the over-investment
problem is more severe for firms with fewer growth opportunities. Considering the disciplinary role of leverage on the over-investment
problem and ownership structure as a control mechanism to affect financing decisions, we hypothesize that the association
between ownership structure and leverage is stronger for firms with fewer growth opportunities. We find that the association
between equity ownership and leverage is significant for low-growth firms, but not for high-growth firms. The results mostly
hold when sample firms are partitioned into large and small firms to directly control for the effect of firm size on the association
between ownership structure and leverage.
相似文献
Kishore TandonEmail: |
20.
This paper examines the transitory price effects of index futures trading extension on the underlying stock market. Based
on the model formulation of George and Hwang (1995) and Amihud and Mendelson (1987) and using the Hong Kong data, we find that the extension of futures trading hour helps to reduce the opening pricing errors
and change the correlations between daytime and overnight stock returns. Our finding adds to the literature that the trading
behavior of derivatives has a significant influence on the transitory price changes of the underlying cash products.
相似文献
Louis T. W. ChengEmail: |