We investigate the effect of Third-Party Auditor Liability (TPAL) risk on firms' trade credit policies. Exploiting the staggered state-level changes to TPAL in the US as a quasi-natural experiment, we find that firms in states with a higher risk of TPAL increase their use of trade credit. This relationship is more pronounced for firms with a more enhanced information environment, those with greater financial constraints, and those whose auditors are more exposed to litigation risk. Overall, our findings provide evidence of how TPAL affects firms’ short-term financing needs.

中文翻译：

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第三方审计师责任风险和贸易信用政策


我们研究了第三方审计责任（TPAL）风险对公司贸易信贷政策的影响。利用美国 TPAL 州级交错变化作为准自然实验，我们发现 TPAL 风险较高州的企业增加了贸易信贷的使用。对于信息环境更加完善的公司、财务约束较大的公司以及审计师面临诉讼风险更大的公司来说，这种关系更为明显。总体而言，我们的研究结果提供了 TPAL 如何影响企业短期融资需求的证据。