Date of Award
Olin Business School
Doctor of Philosophy (PhD)
I examine the use of accounting information in external finance. In Chapter 1, I study the use of accounting disclosure in equity crowdfunding to understand how accounting and financial reporting facilitates start-up financing. I find no relation between historical accounting disclosure and start-up capital obtained from crowdfunding investors, on average. However, I find a positive relation between capital raised and the entrepreneurs long-term forecasts of expected future performance. In Chapter 2, I examine the use of financial covenants in private debt contracts when borrowers have incentives to increase the riskiness of the firms investments. I find that debt contracts to borrowers with greater risk-taking incentives prior to contract inception are more likely to include a debt-to-earnings covenant. In Chapter 3, in co-authored work with Peter Demerjian and Jared Jennings, I examine whether the borrowers management earnings forecast accuracy is useful information in screening by providing an observable signal of the borrowers ability to anticipate future economic conditions. We find that borrowers with more accurate forecasts prior to contract inception receive a lower interest rate.
Chair and Committee
Radhakrishnan Gopalan, Jared Jennings, Xiumin Martin, Peter Demerjian,
Donovan, John, "Essays in Accounting Information and External Finance" (2016). Arts & Sciences Electronic Theses and Dissertations. 812.
Available for download on Friday, May 15, 2116