Using seasoned equity offerings (SEOs) from 1989 to 2008, we examine the role of accounting conservatism in the equity market. We find that issuers with a greater degree of conservatism experience less negative market reactions to SEO announcements. We further show that an important mechanism...

This study examines the role of financial reporting conservatism in mitigating under-investment problems. Recognizing that volatile cash flows increase the need to access external capital markets, and that agency conflicts and information asymmetry make external capital costlier than internal...

Using data from 19 countries over the 1990–2015 period, we examine how economic policy uncertainty (EPU) affects accounting quality. We find that accounting quality, measured based on Nikolaev's (2018) model, increases during periods of high policy uncertainty. This relation is confirmed by...