Corporate finance theory provides both precise and approximate formulas for the maximum growth rate of a firm, typically called the internal growth rate (when no external funds are permitted) and the sustainable growth rate (when the capital structure is held fixed). The assumption in these...

Corporate finance theory provides both precise and approximate formulas for the maximum growth rate of a firm, typically called the internal growth rate (when no external funds are permitted) and the sustainable growth rate (when the capital structure is held fixed). The assumption in these...

This paper investigates the relation between debt valuation adjustments (DVAs) and top executive compensation in the banking industry. DVAs arise from changes in fair value of liabilities associated with changes in a firm’s own credit standing, and have become a significant income component...

Under SFAS No. 159, U.S. firms have the option to measure debt liabilities at fair value, which results in recognition of unrealized gains and losses from debt valuation adjustments (DVA) when a firm's own credit risk changes. Critics have raised concerns about the counterintuitive income...