Venture capitalists, unquoted equity investment appraisal and the role of accounting information

Article Abstract:

UK venture capitalists use a range of information when making investment decisions. They aim to assess the value of companies they invest in, and rates of return. Venture capitalists vary in their approach according to whether they are independent, with independents also more likely to invest in the early stages of a business. Discounted cash flow estimates tend to be used more by venture capitalists than investment analysts, who are more likely to use asset-based methods.

Venture Capital Companies, Miscellaneous Intermediation, Investors, not elsewhere classified, Accounting, auditing, & bookkeeping, Accounting & Auditing Services, Accounting, Tax Preparation, Bookkeeping, and Payroll Services, Management, Evaluation, Accounting, Investments

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A note on selecting a response measure for financial distress

Article Abstract:

Researchers examine financial distress prediction models to determine the usefulness of accounting information to lenders. The results indicate that loan default/accommodation models predict the distress event event better than bankruptcy models. Furthermore, a loan default/accommodation response is a more valid response than bankruptcy for determining information useful to lenders in predicting future insolvency of the firm.

Reporting & Disclosure, Accounting and auditing, Credit ratings, Disclosure statements (Accounting), Financial contingencies

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