Details

Autor(en) / Beteiligte

• Cutillas Gomariz, Mª Fuensanta
• Sánchez Ballesta, Juan Pedro

Titel

Financial reporting quality, debt maturity and investment efficiency

Ist Teil von

• Journal of banking & finance, 2014-03, Vol.40, p.494-506

Ort / Verlag

Amsterdam: Elsevier B.V

Erscheinungsjahr

2014

Quelle

Alma/SFX Local Collection

Beschreibungen/Notizen

• •We examine the role of FRQ and debt maturity in investment efficiency.•We find that FRQ reduces overinvestment.•We find that shorter debt maturity mitigates overinvestment and underinvestment.•The effect of FRQ on investment efficiency is decreasing with shorter maturities. This study, conducted with a sample of Spanish listed companies during the period 1998–2008, examines the role of financial reporting quality and debt maturity in investment efficiency. The results show that financial reporting quality mitigates the overinvestment problem. Likewise, lower debt maturity can improve investment efficiency, reducing both overinvestment and underinvestment problems. We further find that financial reporting quality and debt maturity are mechanisms with some degree of substitution in enhancing investment efficiency: firms with lower (higher) use of short-term debt, exhibit higher (lower) financial reporting quality effect on investment efficiency.