The cost and timing of financial distress

Elkamhi, Redouane; Ericsson, Jan; Parsons, Christopher A.

doi:10.1016/j.jfineco.2012.02.005

Cited by 87 publications

(34 citation statements)

References 51 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…In detecting fraud, it is necessary to check fraud (fraud auditing). Fraud checking is a proactive audit approach that is designed to respond to fraud risk [11]. The audit process must be based on cheating theory.…”

Section: B Fraudulent Financial Reportingmentioning

confidence: 99%

Factors Affecting Fraudulent Statement in Forensic Accounting Perspective

Handoko¹,

Hendra²,

Anandita³

2019

IJITEE

View full text Add to dashboard Cite

Nowadays the awareness of loss from fraud has been shifted from blue collared employee theft to white collared management fraudulent statement. Forensic accounting becomes one of the solutions to detect this fraudulent statement. On the basic of our premise, the purpose of research to explore empirical evidence regarding financial statement fraud detection factors with net worth method as control variable. Our independent variables were debt to equity ratio, change in net assets, and return on asset. The research was quantitatively on food and beverage manufacturing companies listed on the Indonesia Stock Exchange. We use financial statement year end audited from 2013-2017. We used purposive sample, when selecting the samples. Total of 55 company reports samples were used in this research. We analyzed the data using statistical multiple linear regression analysis. We used statistical software to do the regression, in order to answer the research questions and test the hypothesis. Fraudulent reporting fraud was examined using proxies Beneish M-score. After the statistical test, this research concludes that financial distress factor proxy Debt to Equity Ratio (DER) has no significant effect on fraud detection. Other factor that is financial stability was proxies by changes in total assets (ACHANGE), and financial targets in the proxy of Return on Assets (ROA) both have significant impact on the detection of financial statement fraud.

show abstract

Section: B Fraudulent Financial Reportingmentioning

confidence: 99%

Factors Affecting Fraudulent Statement in Forensic Accounting Perspective

Handoko¹,

Hendra²,

Anandita³

2019

IJITEE

View full text Add to dashboard Cite

show abstract

“…8 In order to derive the average maturity of total liabili es, we start by calcula ng a weighted average 6 Since put op ons with different strikes behave similarly with respect to changes in the asset value and in the other model parameters, very li le would be gained by using more than one op on in the es ma on. 7 A similar assump on is employed in Ericsson et al (2007) and Elkamhi et al (2012). 8 While a typical firm usually has several different kinds of debt outstanding our capital structure model considers only a single bond.…”

Section: Parameters To Be Es Matedmentioning

confidence: 99%

“…These ex ante es mates amount to an average of 4.5%. Elkamhi et al (2012) point out that esmates by Andrade & Kaplan (1998) should be applied to ex-post asset values at the me of bankruptcy. They therefore extend this approach using a structural model, which allows them to map the ex-post bankruptcy cost percentages to ex-ante percentages and find that they are too low to support commonly observed leverage ra os.…”

mentioning

confidence: 99%

Market Implied Costs of Bankruptcy

2013

View full text Add to dashboard Cite

“…More recent work uses lower tax rates (based on Graham (2000)) and lower bankruptcy costs (based on Andrade and Kaplan (1998), who report numbers about a third as large). It could be the case, however, that costs at default are in fact much higher ex ante than those observed ex post (see, e.g., Glover (2016)) or that distress costs are realized prior to default (see, e.g., Elkamhi, Ericsson, and Parsons (2012)). In addition, the dependence of bankruptcy costs on the state of the economy may be an alternative mechanism that influences the level of the optimal leverage.…”

Section: B Capital Structurementioning

confidence: 99%

Time‐Varying Asset Volatility and the Credit Spread Puzzle

Du¹,

Elkamhi

Ericsson

2019

The Journal of Finance

Self Cite

View full text Add to dashboard Cite

Most extant structural credit risk models underestimate credit spreads—a shortcoming known as the credit spread puzzle. We consider a model with priced stochastic asset risk that is able to fit medium‐ to long‐term spreads. The model, augmented by jumps to help explain short‐term spreads, is estimated on firm‐level data and identifies significant asset variance risk premia. An important feature of the model is the significant time variation in risk premia induced by the uncertainty about asset risk. Various extensions are considered, among them optimal leverage and endogenous default.

show abstract

The cost and timing of financial distress

Cited by 87 publications

References 51 publications

Factors Affecting Fraudulent Statement in Forensic Accounting Perspective

Factors Affecting Fraudulent Statement in Forensic Accounting Perspective

Market Implied Costs of Bankruptcy

Time‐Varying Asset Volatility and the Credit Spread Puzzle

Contact Info

Product

Resources

About