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THE RELEVANCE OF ACCOUNTING INFORMATION IN BOND MARKET
(De la Salle Lipa Philipines + Universitas Widyatama Bandung, 2011-04-27) Sherlita, Erly
Previous empirical research on accounting information has focused on stock market, and has not examined for bond market. The accounting information should differ for stockholders and bondholders. This paper investigates the role of accounting quality in improving bond liquidity. High accounting quality not only reduces information asymmetry, but also decreases overall uncertainty in the market, thereby improving liquidity. The objective of this study is to examine the role of accounting quality in the bond market, and the results highlight the importance of information quality in improving liquidity. I use earnings quality as accounting quality’s measurement. The result showed that accounting information had influence in bond market Keywords: Accounting information, accounting quality, bond liquidity