The Relationship between Voluntary Disclosure, External Financing, and Financial Status
Author
Summary, in English
Using unique Swedish disclosure data from 2007 to 2012, this paper reports three important sets of findings with regard to the relationship between firms’ voluntary disclosure, external financing, and financial status. First, financially strong firms disclose more than weaker ones. Second, firms that obtain new financing (equity or debt) disclose more than firms that do not. Third, the association between voluntary disclosure and financing events is stronger in financially weak firms. This last finding is new in the literature. Perhaps financially weak firms that obtain external funding have higher disclosure to counteract contracting and valuation problems in the financial markets.
Department/s
Publishing year
2015
Language
English
Publication/Series
Journal of Business Finance & Accounting
Volume
Forthcoming
Document type
Working paper
Topic
- Business Administration
Keywords
- Voluntary disclosure
- financial status
- external finance
- debt overhang
Status
Published