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This study investigates the media activities of firms issuing private equity placements and seasoned equity offerings in Taiwan, as firms have incentives to manage media coverage to influence their stock prices during private equity placement.

We collect a corpus of news stories and transform the news into term sets based on the part of speech. Then, we refer to Cecchini et al. (2010) to classify the news terms into positive, negative, and usual categories. Next, we employ the SVM algorithm to perform the classification tasks and the term frequency method to perform the text mining task. In last, we use a multiple regression model to verify the hypotheses.

We determine that issuing firms in a private placement have substantially more positive news stories and fewer negative news stories than those in public offerings. Furthermore, we evidence that the media management effects of postequity issues are more active than those of preequity issues. Finally, our results demonstrate that the timing and content of financial media coverage among different equity issuance methods may be biased by firm management. According to previous studies, they may attempt to manipulate stock prices to increase the number of highly profitable insider stakeholders.

To our knowledge, this is the first study to investigate that if private placement will associate with more active media management than the public offerings. According to our results of the difference-in-means test, the public offerings market may control news coverage; however, this result is inconsistent with that of the regression results. The private placements market may also exercise media management in the “before announcement day” and “after announcement day” periods by increasing positive news and reducing negative news.

Work readiness is an important aspect of the transition from higher education to professional practice. The purpose of this study was to explore the perceptions of work readiness of individuals transitioning into physiotherapy practice in Australia and identify any association with personal, education and work factors.

Purpose-built surveys were distributed to final-year students and graduates of physiotherapy programmes nationally. Work readiness was measured using the recently validated Work Readiness Scale for Allied Health Professionals 32 (WRS-AH32), which captures the following four domains: Practical Wisdom, Interpersonal Capabilities, Personal Attributes and Organisational Acumen. The surveys also included personal, education and work data. Work readiness was expressed as percentages for total work readiness and within each domain. Independent t-tests were used to examine the influence of personal, education and work factors on work readiness.

176 participant responses were analysed (84 students and 92 graduates). Total work readiness was 80% [standard deviation (SD)8], with Practical Wisdom the highest scoring domain (91%, SD8) and Personal Attributes the lowest scoring domain (65%, SD14). Considering overall work readiness, individuals reporting some psychological symptoms scored lower than asymptomatic individuals [mean difference 7% (95% confidence interval (CI) 4 to 9)] and final-year students scored less than graduates [mean difference 3% (95%CI 0 to 5)].

All stakeholders, including individuals, universities and employers, need to consider further strategies to develop aspects of work readiness, particularly within the domain of Personal Attributes and those with psychological symptoms.

This study demonstrates that physiotherapy students and graduates perceive themselves to be well prepared to transition to the workforce.

This study focuses on an emerging market, China, and investigates the effects of corporate research and development (R&D) spending and subsidies on stock market reactions to seasoned equity offering (SEO) announcements.

The study uses a sample of SEOs announced over the period of 2003–2018 in the Chinese A-share market. The cumulative abnormal stock returns (CARs) are adopted to measure the stock market response to SEOs. The R&D spending-to-sales ratio (R&D subsidies) in 2 years before SEO announcements is used to measure the pre-SEO R&D spending (R&D subsidies). The instrumental variable (IV) regression method is applied to address the endogeneity problem in the robustness test.

This study demonstrates that firms with high R&D spending suffer stock overpricing and experience a negative market reaction when they announce SEOs, but R&D subsidies alleviate stock overpricing and mitigate the negative relationship between R&D spending and SEO market reactions.

Although the prior studies have demonstrated that information asymmetry, which causes stock overpricing, explains negative stock market reactions to SEOs, it is unclear if a certain factor that causes information asymmetry affects SEO market reactions. This study fills this gap and focuses on R&D spending, demonstrating that R&D spending is negatively related to SEO performance.

Access to financing is a key success factor for start-ups. High failure rates, long payback periodse and asymmetries lead to conservative pricing and valuation discounts. The authors examine financial marketing and contingent factors, as enablers of a “patent premium” by private equity (PE) investors targeting start-ups in their growth and expansion stages.

Drawing from the contingency, innovation and signaling theories, the authors collect patent records for Italian start-ups in which a higher than 30% stake was acquired by PE investors during the period 2014–2020. The authors apply a generalized linear model with a logit link and robust clustered error to test the key relationships and control for endogeneity with a Heckman two-stage selection model.

Findings indicate start-ups’ access to financing is significantly impacted by marketing constructs adopted in the operation. Innovation alone does not suffice to determine a valuation premium, unless contingent on the promotion of its product, the placement -investors targeted-of the equity, brand equity levers of previous ownership and marketing competence backing the deal.

The authors provide new insights in the marketing-finance interface, highlighting levers that reassure investors and enable monetizing innovation in start-ups that are still privately held. The authors bridge a gap in literature that has mainly focused on venture capital and innovation financing in the open market, as well as a significant gap regarding the marketing design of private equity placements.

This paper aims to investigate how the passage of the Sarbanes Oxley Act (SOX) impacted the likelihood and timing of the decision of leveraged buyout (LBO) firms to exit via initial public offering (IPO) (reverse-LBO) and the mediating effect of reputed private equity (PE) firms.

The sample comprises firms that went private via LBO between 1990 and 2018. The authors use logistic and ordinary least square regression models to compare the effect of SOX on the re-listing decision and the time taken to re-list.

LBO firms were less likely to exit via public offering after SOX, and the time from LBO to IPO was significantly longer for exiting firms post-SOX. PE firm reputation partially reversed the reluctance to exit via IPO and shortened the time to exit.

The primary focus is RLBOs; the authors do not directly examine other methods of LBO exit. The findings have policy implications for unintended impacts of SOX. Despite the benefits of increasing transparency and protecting investors, SOX reduced the likelihood of going public and increased the time to IPO, potentially reducing product market competition.

RLBOs present a unique experimental setting as the authors can test the impact of SOX on both the likelihood and time to go public, whereas prior literature using first-time IPO samples are able to test only the likelihood. The authors also show that the reputation of the advising PE firm attenuates the reluctance and time taken for RLBOs to re-list. The authors are, thus, able to provide a new perspective on the impact of SOX on the going public decision.

The authors examine one special focus of Special Purpose Acquisition Companies (SPACs), namely environmental, social and governance (ESG) related investments. The authors document the performance of SPACs with and without ESG focus.

The authors collect data, from several sources, on 1,737 SPAC IPOs formed between 2003 and 2022. A SPAC's focus on ESG is classified based on declared focus in Securities and Exchange Commission (SEC) filings and in post-merger annual reports. The authors examine operational and financial performance of SPACs with and without ESG focus.

In the study's sample, only 50% of SPACs that announced an intention to acquire an ESG target ended up consummating a merger with an ESG private firm. ESG SPACs exhibit worse operating performance than non-ESG SPACs. Furthermore, they experience 11.6% lower 1-year post-merger excess returns than their non-ESG counterparts.

The study provides an examination of ESG firms that came to market via mergers with SPACs, which is an alternative method to traditional initial public offerings (IPOs). The study also provides a comparison of both operational and stock performance of ESG and non-ESG SPACs.

An emerging line of research examining the role of numerological superstition in the capital market shows that it has significant impact on investor behavior (Bhattacharya, Kuo, Lin, & Zhao, 2018; Hirshleifer, Jian, & Zhang 2018). However, to the authors’ best knowledge, there is a dearth of evidence on whether numerological superstition affects corporate behavior. This study fills this void by examining the association between investors’ numerological superstition and earnings management using Chinese data.

Chinese culture views 6 and 8 as lucky numbers. Using Chinese publicly traded firms, the authors examine the relation between investors’ numerological superstition and corporate financial reporting behavior.

The results suggest that firms reporting lucky earnings-per-share (EPS) numbers ending with 6 or 8 are more likely to engage in earnings management. These firms also raise more capital through seasoned equity offerings in the following year; however, they do not have more capital investments. Instead, their controlling shareholders siphon a significant amount of capital through related party transactions. Overall, the findings suggest that managers collude with controlling shareholders to manage earnings by exploiting the superstitious beliefs of minority shareholders.

To the authors’ best knowledge, there is a dearth of evidence on whether numerological superstition affects corporate behavior. This study fills this void by examining the association between investors’ numerological superstition and earnings management using Chinese data.

One can always blame that the pandemic has again revealed the weaknesses of our international governance. One can also blame governments for not being able to more quickly draw lessons from the Covid-19 crisis. Nevertheless, despite very different and uncoordinated agendas from various stakeholders involved across the world, we see a first convergence around corporate social responsibility (CSR) and environmental social and governance (ESG) agendas in the context of increasing climate change and ecological transition global awareness.

Even if their interests are very different by design, global stakeholders share at least the fact that our planet has now reached its limits in terms of resources and their exploitation. Even if some consider that humanity, not to say Humanism, is slow to happen on the global scale, we see the early stages of stronger corporate responsibility of all stakeholders, including and starting with the business sector. Corporate business has positively moved from a ‘greenwashing’ attitude at the end of twentieth century and beginning of the new one, to a more integrated and risks-related corporate responsibility awareness that now appears to be a must have.

This chapter investigates the cost of public debt for firms using a comprehensive sample consisting of 17,368 industrial bond issues from 1970 to 2011. The empirical evidence shows that yield spreads for seasoned bond issues are significantly lower than those for initial bond issues. This seasoning effect is robust across different sample periods, subsamples, and model specifications. On average, the yield spreads for seasoned bond issues are around 50 bps lower than those for initial bond issues. This difference cannot be explained by other bond and firm characteristics. The seasoning effect is more pronounced for firms with higher levels of uncertainty, lower information disclosure quality, and longer time intervals between the first and subsequent issues. Our empirical findings provide supportive evidence for the extant theories that aim to rationalize the information role in determining the cost of capital.

This study aims to examine the association between fair value accounting and the cost of corporate bonds, proxied by bond yield spread. In addition, this study explores the moderating role of auditor industry expertise at both the national and the city levels.

This study first examines the effect of the use of fair value on yield spread by estimating firm-level regression model, where fair value is the testing variable and yield spread is the dependent variable. To test the differential impact of the three levels of fair value inputs, this paper divides the fair value measures based on the three-level hierarchy, Level 1, Level 2 and Level 3, and replace them as the test variables in the regression model.

This study finds that the application of fair value accounting is generally associated with a higher bond yield spread, primarily driven by Level 3 estimates. The results also show that national-level auditor industry expertise is associated with lower bond yield spreads for Level 1 and Level 3 fair value inputs, whereas the impact of city-level auditor industry expertise on bondholders is mainly on Level 3 fair value inputs.

The paper innovates by exploring the impact of fair value accounting in a setting that extends beyond financial institutions, the traditional area of focus. Moreover, most prior research considers private debt, whereas this study examines public bonds, for which investors are more likely to rely on financial reporting for their information about a firm. Finally, the study differentiates between city- and national-level industry expertise in examining the role of auditors.

This research has several practical implications. First, firms seeking to raise debt capital should consider involving auditors, with either industry expertise or fair value expertise, due to the roles that auditors play in safeguarding the reliability of fair value measures, particularly for Level 3 measurements. Second, from standard-setting and regulatory perspectives, the study’s findings that fair value accounting is associated with higher bond yield spread cast further doubt on the net benefits of applying a full fair value accounting regime. Third, PCAOB may consider enhancing guidance to auditors on Level 2 fair value inputs, to further enhance audit quality. Finally, creditors can be more cautious in interpretating accounting information based on fair value while viewing the employment of auditor experts as a positive signal.

First, the paper extends research on the role of accounting information in public debt contracting. Second, this study adds to the auditing literature about the impact of industry expertise. Finally, and more generally, this study adds to the ongoing controversy on the application of fair value accounting.