دانلود رایگان مقاله انگلیسی کیفیت اقلام تعهدی، اعتبار بیمه گر، و برابری های شرکتی اوراق قرضه: شواهدی از چین - الزویر 2017

ABSTRACT

This study examines the relationship between accruals quality and the underpricing of corporate bonds in China and how underwriter reputation affects this relationship. We find that (1) accruals quality is negatively associated with the magnitude of bond underpricing and (2) the impact of low accruals quality on underpricing is partially offset by hiring reputable underwriters. A path analysis shows that approximately 11% of the effect of accruals quality on underpricing is attributable to the indirect path through reputable underwriters, suggesting that accruals quality is more effective than reputable underwriters in lowering bond underpricing. These findings are significant for initial bond offerings, but not for secondary bond offerings. We also find that low accruals quality is associated with more restrictive non-price contract terms such as greater collateral requirements and stricter covenants.

8. Conclusions

The purpose of this study is to investigate two hypotheses. The first hypothesis examines how firms’ accruals quality impacts underpricing in the Chinese corporate bond market. Our regression analyses reveal that bond underpricing in China is inversely associated with accruals quality, after controlling for bond- and firm-specific characteristics. This evidence is consistent with the asymmetric information theory that underlies discussions of IPO underpricing in the literature. According to this theory, higher accruals quality helps to reduce information asymmetry and mitigate bond underpricing. The second hypothesis investigates whether the presence of reputable underwriters reduces the adverse effect of poor accruals quality (information risk) on bond underpricing. Our results indicate that reputable underwriters play a role in mitigating the effects of low accruals quality on bond underpricing. To examine the effectiveness of reputable underwriters in alleviating information problems, we specify the direct path and indirect path based on the model in Bhattacharya et al. (2012). Using path analysis, we test for the existence and relative importance of both paths. We then provide statistically reliable evidence of both a direct path and an indirect path, with the direct path (accruals quality) having greater (often, much greater) importance than the indirect path (reputable underwriters). However, in our additional tests, we find there is no significant association between accruals quality, underwriters and bond underpricing for secondary bond offerings. Furthermore, we find that firms with low accruals quality are associated with more restrictive non-price contract terms such as greater collateral requirements and stricter covenants.