Quality of Accounting Information, Executives’ Background and Loans of Small and Medium-Sized Enterprises
International Journal of Economics, Finance and Management Sciences
Volume 6, Issue 5, October 2018, Pages: 216-223
Received: Nov. 7, 2018;
Published: Nov. 8, 2018
Views 286 Downloads 46
Hu Guohui, School of Economics, Wuhan University of Technology, Wuhan, China
Zheng Meimei, School of Economics, Wuhan University of Technology, Wuhan, China
Zhao Le, School of Economics, Wuhan University of Technology, Wuhan, China
Small and medium-sized enterprises (SMEs) in China are currently still facing serious lending constraints, especially long-term loan constraints. This paper empirically studies on how the accounting information quality and executives’ background of SMEs influence their credit availability and loan term structures. We use panel data from 2010 to 2015 of Chines SMEs financial report database, matched with the executive characteristic database. The findings suggest that with better accounting information quality or the executives’ financial or political background, SMEs’ short-term credit availability can be improved. Furthermore, the impact of executives’ financial background is the largest. As for the long-term credit availability, the quality of accounting information plays a more important role than the executives’ background. In addition, the interaction between quality of accounting information and executives’ background on SMEs’ credit availability varies in different terms of loans, showing supplementary effect for short-term loans and substitute effect for long-term loans.
Quality of Accounting Information, Executives’ Background and Loans of Small and Medium-Sized Enterprises, International Journal of Economics, Finance and Management Sciences.
Vol. 6, No. 5,
2018, pp. 216-223.
Xiao Zuoping, Liao Li. Does Corporate Governance affect debt maturity levels?-empirical data from listed companies in China [J]. Managing the world,2008, (11): 143-156.
Lu Zhengfei, Han Xia, Chang Qi. A study on the relationship between long-term debt and Investment behavior: an empirical Analysis based on Chinese listed companies [J]. Managing the world 2006, (01): 120-128.
Rao Yanchao, Hu Yiming. Investigation and Analysis on the use of Accounting Information in Bank Credit [J]. Accounting Research,2005. (4): 36-41.
Ma Rujing, Jiang Chao, Tang Xuesong. Earnings quality of debt Enterprises and Bank loan Decision-Making [J]. Financial Science: 2015, (10): 55-63.
Lin Zhonggao, Yang Yuxin. Risk prompt Information and Bank Credit Decision--A study on the text Information of A-share listed companies' Annual report [J]. Journal of Anhui normal University (Humanities and Social Sciences) ,2017,45 (2): 245-255.
Hackbarth, D. Managerial Traits and Capital Structure Decisions[J]. Journal of Financial and Quantitative Analysis, 2008,(43):843-882.
Zhang Zhaoguo, Liu Yongli, Tan Duojiao. Managerial background characteristics and accounting conservatism-empirical data from Chinese listed companies [J]. Accounting Research: 2011, (7): 11-18.
Cao Yugui, Xiao Chaolan. A study on the relationship between the background characteristics of Executive team and enterprise debt financing [J]. Accounting Bulletin, 2014, (6): 75-77.
Tang Jianxin, Lu Jianlong, Yu Minggui. Bank Relations, political Relations and Private Enterprise loans- empirical evidence based on China's Private listed companies [J]. Economic Review, 2011, (3): 51-58.
Yu Minggui, Pan Hongbo. Ownership, Commercial Credit and Credit Resource allocation efficiency [J]. Economic Management, 2010, (8): 106-117.
Guo Tianyong, Li Xianwen. Empirical Analysis of Relational Lending and SMEs financing [J]. Financial Forum, 2006, (4): 49-53.
Yuan Ruiying. Research on the influence of Accounting Information Transparency on Credit risk [J]. Accounting Newsletter, 2014, (24): 3-6.
Bhattacharya N., Desai H., Venkataraman K.. Does Earnings Quality Affect Information Asymmetry:Evidence from Trading Costs[J]. Contemporary Accounting Research, 2013,30(2): 482-516.
Zhang Zhong, Wu Xiaojun. Quality of Accounting Information and Mathematical Analysis of small and Medium-sized Enterprises financing [J]. Journal of Hubei University for nationalities (Natural Science Edition),2007, 25 (2): 230-233.
Bharath S.T.,Sunder J.,Sunder S. V.. Accounting Quality and Debt Contracting[J]. Accounting Review,2008,83(1):1-28.
Graham J.R.,S. Li,J. Qiu. Corporate Misreporting and Bank Loaning Contracting[J]. Journal of Financial Economics,2008,89(1):44-61.
Lu Zhengfei, Zhu Jigao, Sun Lengxia. Earnings Management, Accounting Information and Bank debt contract [J]. Manage the world, 2008, (3): 152-158.
Jiang Dongsheng. Who got a long term loan? [J] Managing the world, 2012, (7): 167-169.
Adam R.,Ferreira D.. A Theory of Friendly Boards[J]. The Journal of Finance,2007, 62(1):217-250.
Faccio,M.,Masulis,Ronald,W.,and Mc Connell,John,J.. Political Connections and Corporate Bailouts[J]. The Journal of Finance,2006(6):2597-2635.
Luo Danglun, Zhen Liming. Private Control, political Relations and Enterprise financing constraints-the Management data based on Chinese Private listed companies [J]. Financial Studies, 2008, (12): 164-178.
Hong Yitian, Chen Jinlong. Social capital, ownership attributes and financing constraints [J]. Accounting Newsletter, 2014, (5): 26-29.
Ciamarra E.S.. Monitoring By Affiliated Bankers on Board of Directors: Evidence from Corporate Financing Outcomes[J]. Financial Management,2012,41(3):665-712.
Yu Minggui, Pan Hongbo. Political connection, Institutional Environment and Private Enterprise Bank loan [J]. Managing the world, 2008, (8): 9-21.
Yuan Chunsheng. A study on the impact of political connections on Credit financing of Private Enterprises [J]. Journal of Shanxi University (philosophy and Social Sciences),2014, 37 (6): 125-130.
Rao Pingui, Jiang Guohua. A study on the impact of Monetary Policy on the interaction between Bank Credit and Commercial Credit [J]. Economic studies, 2013, (1): 68-82.
Wu Peng, Zhong Weijun, Wu Yingyu. Research on early warning of Financial crisis based on modified Jones earnings Management Model [J]. Business economy and Management, 2010, (8): 67-74.