BBAuthors: Kaumanns, Sebastian; Advisor: -; Participants: - (2019)
This study provides comprehensive descriptive evidence on the occurrence, size, and reporting by managers and the financial press of debt value adjustments due to a change in own credit risk (DVAs). The study is motivated by a public debate about DVAs in which critics describe them as ‘‘counterintuitive’’ and claim that managers disclose DVA information strategically to make firms ‘‘look good’’. Analyzing a sample of 405 firm-quarters of 19 US financial firms that report DVAs between 2007 and 2014, I found that positive and negative DVAs appear
similarly often and with similar magnitude. I further found that managers provide more information on large negative DVAs compared to positive DVA... 
