Quality of Accounting Information Disclosure and Debt Financing Cost: Literature Review

Abstract

This paper mainly summarizes the domestic and foreign literature on accounting information and debt financing to analyze the impact of accounting information disclosure on debt financing cost. In the case of rapid changes in the external environment, it is a critical moment for companies to adapt to the environment and survive. In this context, if an enterprise wishes to survive, it must find a way of survival suitable for its development according to its actual situation. However, the survival of some companies is facing a serious crisis. To stimulate their potential and ensure their long-term progress, companies must seek external help. Therefore, debt financing activities have become the first choice for companies. When an enterprise conducts external financing, it must present the accounting information disclosed by the enterprise to the relevant external creditors. Creditors use this to understand the various conditions of the enterprise and use this as the basis for investment. Only high-quality accounting information disclosure can win the trust of relevant external investors, reduce debt financing costs, and obtain more financing. Based on this, this article combs、summarizes and analyzes the relevant literature on the relationship between the quality of accounting information disclosure and the cost of debt financing, and proposes some shortcomings and prospects.