On April 10, 2019, the first (43rd in total) academic salon for doctoral students in 2019 was staged in the conference room on the second floor of library in Shenzhen University (SZU) by the China Center for Special Economic Zone Research (CCSEZR), a key research base for humanities and social sciences under the Ministry of Education. The guest speaker of this salon, Dr. Jiang Liangliang, is Associate Professor at the School of Accounting & Finance, Hong Kong Polytechnic University (PolyU). Her research interests include banking and financial institutions, accounting and auditing in corporate governance, economics of regulation and corruption, and environmental economics. Her works and views have been presented at major finance conferences such as the annual meeting of the American Finance Association (AFA), Western Finance Association (WFA), and European Finance Association. The salon was presided over by CCSEZR associate professor Li Fan and attended by graduate and doctoral students from CCSEZR.
This wonderful lecture with the theme of Media Coverage and Debt Financing explored how media coverage influences debt structure in enterprises. It started off with Dr. Jiang talking about motivation and pointing out that debt financing is a significant source of financing for American companies and media coverage has a profound impact on today’s business and financial markets (stock market in particular). She had found that companies with more media coverage are less likely to have bank loans on their balance sheets but they usually have a higher proportion of bonds and debt instruments, which is more obvious in those with lower extent of information asymmetry. Then she indicated that debt structure of a company determines not only its capital structure and shareholder returns but also the chance of survival during a financial crisis and in a recession. At the end of the lecture, she pointed out that news of negative earnings would noticeably decrease the likelihood of new debt financing, especially bank loans and public bonds, but increase the possibility of private placement through her study on news sentiments. News sentiments foretell the ensuing credit rating change, which would then affect debt issuance clauses of private bank loans and public bonds. When the market holds a negative view on the prospects of a company, discretionary accruals on its report would more possibly be negative, which is indicative of the accounting significance of media coverage on shaking a company’s debt structure.
Dr. Jiang’s lecture is novel in theme, broad in perspective and clear in thinking, inviting active student participation in the Q&A session, including questions on how to cope with the often-talked about lag after information disclosure, and the differentiated influence of media substitution and media supplement. Dr. Jiang gave detailed answers to these questions. Many students said they benefited a lot from Dr. Jiang’s lecture which gives inspiration for their future research.
Correspondent: Meng Fei
Associate professor Jiang Liangliang delivers a brilliant speech
Associate professor Jiang Liangliang delivers a brilliant speech
Graduate students from CCSEZR listen to the lecture carefully
Q&A session
A group photo of the salon
