Disclosure of off-balance sheet financing and financial reporting quality

IF 3.3 3区管理学 Q1 BUSINESS, FINANCE

Journal of Accounting and Public Policy Pub Date : 2025-02-03 DOI:10.1016/j.jaccpubpol.2025.107285

Tae-Nyun Kim, Yutong Xie

引用次数: 0

Abstract

We study how the accounting treatment of off-balance sheet financing affects the financial reporting quality. Utilizing a quasi-natural experiment created by Accounting Standards Update (ASU) No. 2016-02 which requires operating leases to be capitalized on the balance sheet, we find that financial reporting quality improves after the update. Such improvement is concentrated among firms with high information asymmetry. We further show that firms with improved financial reporting quality use more debt financing after the rule change. Our evidence corroborates the argument that ASU 2016-02 increases cost of financing and firms mitigate the impact by improving financial reporting quality.

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来源期刊

Journal of Accounting and Public Policy Multiple-

CiteScore

4.80

自引率

2.80%

发文量

期刊介绍： The Journal of Accounting and Public Policy publishes research papers focusing on the intersection between accounting and public policy. Preference is given to papers illuminating through theoretical or empirical analysis, the effects of accounting on public policy and vice-versa. Subjects treated in this journal include the interface of accounting with economics, political science, sociology, or law. The Journal includes a section entitled Accounting Letters. This section publishes short research articles that should not exceed approximately 3,000 words. The objective of this section is to facilitate the rapid dissemination of important accounting research. Accordingly, articles submitted to this section will be reviewed within fours weeks of receipt, revisions will be limited to one, and publication will occur within four months of acceptance.