... of the accrual component of earnings affects lenders’ behavior in transaction-based lending models. They find that, as accrual quality decreases, when making credit decisions, lenders decrease their reliance on income statement, but they do not alter their reliance on balance sheet. However, little is known...

...Stephen Gray; Arjan Premti Purpose This study examines how lenders modify their behavior and their use of traditional, transaction-based lending models in credit decisions when faced with low earnings quality. Design/methodology/approach To measure the earnings quality, following Bharath...