主讲人：张子龙 (City University of Hong Kong)
主 题：Taking a Big Bath upon a Sovereign Downgrade
摘 要：Firms whose credit ratings that are equal to or above the sovereign rating of their country of domicile (bound firms) are more likely to be downgraded than other firms. This sovereign ceiling rule creates exogenous variations in the credit ratings of bound firms. We find that bound firms reduce discretionary accruals after sovereign downgrades and are likely to experience a reversal of earnings subsequent to the accrual reduction. Bound firms are also more likely to manage earnings upward upon a subsequent sovereign upgrade. Further, the reduction in discretionary accruals is more significant in countries with higher disclosure requirements or stronger shareholder protection, consistent with the notion that firms facing restraints of opportunistic disclosure behaviors are more likely to take advantage of peculiar negative shocks to conduct abnormal write-offs. Finally, we find that bound firms increase the impairments of intangible assets after sovereign downgrades. Overall, this study provides evidence that managers may strategically employ big bath accounting in response to negative economic shocks.
张子龙博士现任香港城市大学会计学院助理教授，2008年本科毕业于北京大学，2015年博士毕业于香港科技大学；以独立作者身份于金融学顶级期刊Journal of Financial and Quantitative Analysis发表论文。