Original Paper

China Accounting and Finance Review

, 15:3

First online:

Open Access This content is freely available online to anyone, anywhere at any time.

新会计准则与会计盈余的债务合约有用性

  • Hongqi YuanAffiliated withSchool of Management, Fudan University
  • , Yubo LiAffiliated withSydney Institute of Language and Commerce, Shanghai University
  • , Fang LouAffiliated withSchool of Economics, Shanghai University of Finance and Economics
  • , Yao ZhangAffiliated withSchool of Economics and Management, Tongji University

New Chinese Accounting Standards and the Usefulness of Accounting Information in Debt Contracts

Abstract

This paper investigates whether the usefulness of accounting profitability in debt contracts changes after the adoption of the new Chinese accounting standards (“NCAS”) in 2007. We find that the sensitivity of new debts to accounting profitability declines after the adoption and that firms are heavily influenced by the adoption of the new accounting standards and experience a more significant decrease in sensitivity. Moreover, such a decrease in sensitivity is more pronounced for non-state-owned companies than for state-owned companies. Overall, our results indicate that the usefulness of accounting profitability decreases after the adoption of the new accounting standards.

Keywords

New Accounting Principles Earnings Debt Contracts