This paper studies the joint effect of conservatism and aggregation on the cost of equity capital and the efficiency of debt contracts. In the model, a firm's two assets are valued at either the lower-of-cost-or-market or fair value and the accounting report aggregates the value of the two...

This paper provides a selective survey of Ohlson and Vuolteenaho-type accounting valuation models. The focus is on the valuation, return and cost of capital dynamics of these models. Emphasis is placed primarily on variations of these models that incorporate risk aversion, parameter uncertainty...

We propose a redesign of sovereign Credit Default Swaps (CDS). Under our proposal, a notional CDS position of €100 can be settled by the delivery of whatever package of instruments a sovereign gives in exchange for legacy bonds with a face value of €100. To illustrate, suppose a European...

A firm's failure to protect and control confidential information is posited to affect its cost of debt. Using a sample of 199 cybersecurity breaches from 2005 to 2014, I find a positive association between a cybersecurity breach and a firm's cost of privately placed debt. Compared with loans...

Article aimed to determine the effect of Good Corporate Governance (GCG) which was proxied through the proportion of independent commissioners, managerial ownership, institutional ownership, quality audits, and family ownership on the cost of debt. The objects of this study were companies listed...

We examine whether criminal records of CEOs and rank-and-file employees are associated with firms’ likelihood of bankruptcy and whether lenders adjust their required cost of debt accordingly. We use a nationwide sample of private firms and criminal registers covering all firm employees. We...

We examine the relation between analyst forecast characteristics and the cost of debt financing. Consistent with the view that the information contained in analysts' forecasts is economically significant across asset classes, we find that analyst activity reduces bond yield spreads. We also find...