This study examines the relationship between accounting credibility and firms' ability to fund their investments. Theory suggests that credible reporting resulting from external audits enables firms to attract external funds needed for their investments. The tests exploit monetary policy...

We exploit an informational shock to the firm information environment to examine the relationship between unaffiliated bankers on corporate boards and conditional conservatism. We find that after the information shock, firms with unaffiliated bankers on board experience a statistically and...