This dissertation explores three current issues relevant to the accounting and business communities by empirically examining the effect these issues have on the bond credit market. The first study examines the effect earnings predictability has on both the initial bond rating and the initial pricing of the issue. Earnings predictability is measured as (1) the annual earnings surprise (actual minus analyst forecast) and (2) the dispersion of initial analyst forecasts. The results indicate a negative association between a lack of earnings predictability and both bond ratings and initial bond price. The results are consistent with creditors interpreting greater earnings variability as a dimension of default risk incremental to the benchmark model. These results add to the existing literature by documenting a favorable benefit in the credit arena for firms that have predictable earnings. The second study investigates the effect perceived auditor independence has on the rating assigned to newly issued bonds. The magnitude of non-audit service fees is utilized as a proxy for auditor independence. The results of the study document a consistent negative relationship between the level of non-audit fees provided by the external auditor and the bond rating received by the client for new issues. Several non-audit fee measures are used in the study (raw measure, log scaled, asset scaled, unexpected) and each possess a significant negative association with a firm's bond rating. Importantly, no economic effect was discernable in a classification accuracy analysis. The third study examines what effect, if any, longer auditor tenure has on the client's bond rating. There is some contention that longer auditor tenure can lead to substandard audits either through the auditor's excessive desire to retain the client or through general auditor complacency. However, the issue of auditor tenure is far from one-sided. An alternative view asserts that longer auditor tenure increases client-specific knowledge and, thus, results in increased audit quality. Results indicate a positive association between auditor tenure and the client's bond rating on new issues suggesting that longer auditor tenure is perceived to be beneficial by bond rating analysts. This is consistent with financial statement users perceiving longer tenured auditors to have more client specific knowledge thus increasing auditor competency and a better audit. Overall, these results contribute to the existing knowledge-base in accounting by empirically demonstrating how several important issues of interest to the accounting profession are impounded into a firm's bond rating. This research provides a detailed look at how one important group of knowledgeable financial statement users, i.e. bond rating analysts, incorporate several issues that are relevant and important to the professional community. / Ph. D.

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This thesis considers the link between financialisation and emerging market government policy autonomy. It analyses the government bond markets of three case study countries: Brazil, Lebanon and Turkey. Using extensive interview data in the three countries, and interviews with financial market actors in London and New York, the study explores the investment behaviour of a range of investors: commercial banks; individual investors; mutual funds; pension funds and hedge funds. The thesis uses the framework of financialisation – measured by the ability to trade risk – to analyse both international and domestic investors. The study shows that increased financialisation, of both financial market actors and the structure of government bond markets, generally serves to reduce loyalty and therefore reduces government policy autonomy. However, it is demonstrated that initial financialisation – the development of pension and mutual funds – serves to increase autonomy. This is captured by the construction of an ‘autonomy curve’. The conclusions suggest an updating the use of Hirschman’s concept of voice, exit and loyalty in the analysis of financial markets, to give a greater emphasis on loyalty and to include the use of ‘disloyalty’, the ability to short securities. It is also argued that financialisation is the appropriate framework to analyse processes of change in financial markets. The thesis also makes observations as to the true extent of government policy autonomy in emerging market countries, and policy recommendations regarding those governments’ attitude to financialisation.

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Exploring the main factors that determine bond spreads with respect to Treasury rates is one of the most critical issues in the corporate debt market. Credit risk has long been perceived as the most important determinant of bond spreads (Fisher, 1959). One of the most critical parameters in credit risk models is asset volatility, which includes idiosyncratic and systematic components. However, these models do not distinguish between them. Chapter 2 investigates the impact of idiosyncratic volatility on bond portfolio spreads between 2000 and 2010. While the prediction of traditional asset pricing models is that firm-specific risk should be diversified away at aggregate level, I find idiosyncratic volatility plays an incremental role in explaining bond portfolio spreads beyond the market factors. Recovery is an important measurement of credit risk additional to default probability. Chapter 3 focuses on the estimation of firm recovery after bankruptcy using the Leland and Toft (1996) model. Using a large sample of Chapter 11 filings from 1996 to 2007, I find that the recovery derived from the Leland and Toft model has strong explanatory power on the debt recovery observed in the market. Recent literature finds that all extant credit risk models significantly underestimate bond spreads, especially for investment grade bonds of short maturity. Chapter 4 identifies a heretofore ignored component, perceived accounting misstatement, by regressing bond spreads on the proxy of accounting misstatement propensity, while controlling for issuers’ default risk and bond illiquidity risk between January 1994 and June 2002. My thesis deepens the understanding of bond price discovery mechanisms and presents an important challenge for future research to incorporate the strong empirical relationship between idiosyncratic volatility and bond yields in asset pricing models. My thesis also sheds light on the accurate prediction of debt recovery, which is important to the valuation and hedging of risky debt and credit derivatives. Furthermore, my thesis assists in solving the credit spread puzzle by identifying a new risk factor. Overall, my thesis provides new insights into research on the corporate debt market and has important implications for academic scholars and market practitioners. / Thesis (Ph.D, Management) -- Queen's University, 2013-05-01 07:43:17.718

A large amount of information concerning interatomic distances in the solid state is available, but little has been done in recent times to comprehensively filter, summarize and analyze this information. Here, I examine the distribution of bond lengths for 135 ions bonded to oxygen, using 180,331 bond lengths extracted from 9367 refined crystal structures collected from the Inorganic Crystal Structure Database (ICSD). The data are used to evaluate the parameterization of the bond-length—bond-valence relation of the bond-valence model. Published bond-valence parameters for 135 cations bonded to oxygen, and the various methods used in their derivation, are evaluated. New equations to model the relation are tested and the common form of the equation is found to be satisfactory. A new method (the Generalized Reduced Gradient Method, GRG method) is used to derive new bond-valence parameters for 135 cations bonded to oxygen, leading to significant improvements in fit for many of the ions. The improved parameterization is used to gain crystal-chemical insight into the milarite structure. A literature review of 350+ published compositions is done to review the end-members of the milarite group and to identify compositions that should have been described as distinct minerals species. The a priori bond-valences are calculated for minerals of this structure, and are used to examine the controls of bond topology on site occupancy, notably by localizing the major source of strain of the structure (the B site). Examination of the compositions of all known milarite-group minerals shows that compositions with a fully occupied B site are less common than those with a vacant B site, in accord with the idea that the B site is a local region of high strain in the structure. The bond-length distributions for the ions of the alkali and alkaline-earth metal families are examined. Variations in mean bond-lengths are only partly explained by the distortion theorem of the bond-valence model. I have found that bond length also correlates with the amount of vibrational displacement of the constituent ions. The validity of some uncommon coordination numbers, e.g., [3]-coordinated Li+, [3]-coordinated Be2+, is confirmed. / October 2016

This research evaluates the relationship between ESG score of the firm and its effect on the performance of their bonds. The study looks at listed companies on the Nordic countries ’ stock exchanges and tries to establish a relationship between ESG score and corporate bond yield spread. The study finds that no such relationship can be established and therefore that a high ESG score does not imply a decreased level of required risk premium by bond investors and a decreased or stabilized cost of debt for companies in the Nordic countries. Further, the study will contribute to a theoretical discussion by using the Stakeholder Theory, Legitimacy Theory, The Resource-Based View and finally the Agency theory in order to further analyze the underlying dynamics of this proposed relationship.

The Near Surface Mounted (NSM) strengthening is an emerging retrofitting technique, which involves bonding Fibre Reinforced Polymer (FRP) reinforcement into grooves cut along the surface of a concrete member to be strengthened. This technique offers many advantages over external bonding of FRP reinforcement, for example, an increased bond capacity, protection from external damage and the possibility of anchoring into adjacent concrete members. To date, significant research has been conducted into the NSM FRP strengthening technique. However, there are still some areas which need further research in order to fully characterise bond and anchorage of NSM FRP bars. Lack of experimental data, design tools and analytical models addressing these areas create obstacles for the efficient use of these advanced polymer materials. The particular objectives of the research are; to investigate bond behaviour between NSM FRP bars and concrete, to understand the critical failure modes involved and their mechanics, and to develop a rational analytical model to predict bond strength and anchorage length requirements for NSM FRP bars. Several significant variables affecting bond, such as bond length, size, shape and type of bar, resin type, groove dimensions and concrete strength, have been considered. In particular, attention has been focussed on the effect of bar shape on bond behaviour. A comprehensive set of laboratory testing and their results, including the effect of the investigated parameters are presented. Various modes of anchorage failure of NSM FRP bars are identified and the underlying mechanics are investigated. Analytical models are developed to predict bond capacity and anchorage length requirements of NSM FRP bars, and are verified with experimental results.