Accounting Conservatism and Debt

Subject Areas : Futurology

B. Banimahd ¹

1 - نویسنده مسئول یا طرف مکاتبه

Received: 2008-08-25 Accepted : 2008-12-30 Published : 2011-03-21

Keywords: Debt, accounting conservatism, Return on Asset, governmental ownership, Firm Size,

Abstract :

This paper examines the determinants of debt. Using panel data, the study investigates the effect ofaccounting conservatism on debt. The results of the study indicate that debt is positively correlatedwith accounting conservatism and negatively with return on asset (ROA). Governmental ownership isa major factor in determining firm debt and has stronger a relationship with debt than with otherfactors. When the government’s share of firm capital increases, then debt also increases. Firm size hasalso a down positive relationship with debt. An increase in asset turnover leads to increase debt.