Measuring Distress Risk: The Effect of R&D Intensity
由于研发活动增加，会计困境指标准确性下降。本文发现调整研发的会计处理能更准确识别困境企业，并解释大公司高困境风险低回报的异常现象。
ABSTRACT Because of upward trends in research and development activity, accounting measures of financial distress have become less accurate. We document that (1) higher research and development spending increases the likelihood of misclassifying solvent firms, (2) adjusting for conservative accounting of research and development increases the number of correctly identified distressed firms, and (3) adjusted measures of distress alleviate previously documented anomalously low returns of large, high distress risk, low book‐to‐market firms. The results hold after updating stale parameters and under various tax assumptions. Our evidence raises concerns about interpretation of extant literature that relies on accounting measures of distress.