중소기업의 은행차입과 보수주의 성향에 관한 연구

This study examines the effects of a firm’s financing decision on conservatism in financial reporting. Specifically, this study examines the association between a firm’s bank dependence and accounting conservatism for 1999-2007 using mid-cap companies in Korea. Banks play significant roles in borrowing firms’ corporate governance. Prior studies examining the role of banks in a bank-centered economy generally focus on the stock market effects related to bank debt announcements. However, little empirical evidence exists regarding the role of banks in a borrowing firm’s financial reporting especially in bank-centered economy. To fill this gap and enhance our understanding of the role of banks with respect to financial systems, this study investigates the effects of firm-bank relationships on a borrowing firm’s financial reporting in Korea where banks play important roles in providing liquidity. The results indicate that both conditional and unconditional conservatism are increasing in a firm’s bank dependence. The results are robust to various alternative specifications. These findings imply that, on average, banks effectively monitor the financial reporting behavior of borrowing firms in Korea. This paper makes several contributions to the literature. First, it helps us to further our understanding of the association between financing decision and financial reporting by empirically analyzing the effects of bank debt financing on a firm’s reporting behavior. Second, the findings of this study add to the literature on conservatism by showing that conservatism in financial reporting is associated with a firm’s financing decision and more specifically bank debt financing. Prior studies generally argue that conditional conservatism is closely related to debt contracts because it helps firms to reduce agency costs. This study finds a consistent result with prior studies, showing that, in Korea, banks prefer conservative financial reporting measured as conditional conservatism. Moreover, this study demonstrates that unconditional conservatism is also associated with bank debt financing. This finding suggests the increased monitoring role of banks regarding collaterals. Third, this study finds the result consistent with the positive role of banks. Similar to the U.S., the findings of this study suggest that banks play effective monitoring role especially related to borrowing firms’ financial reporting. Finally, this study provides a meaningful policy implication regarding the capital provision to the mid-cap companies in Korea. One limitation of this study is that this study focuses only on the mid-cap companies due to the limitation on data-collection. Although the mid-cap companies are more likely to be influenced by bank debt financing, future research can extend this research to incorporate large companies providing more generalizability. In addition, future research might extend this research by examining the pre-debt contract period because the current study focuses only on the post-debt contract period.