The Benefits of Structured Data across the Information Supply Chain: Initial Evidence on XBRL Adoption and Loan Contracting of Private Firms

44 Pages Posted: 18 Jun 2014 Last revised: 10 Nov 2016

See all articles by Devrimi Kaya

Devrimi Kaya

Ruhr University of Bochum

Paul Pronobis

ESCP Europe - Department Financial Reporting and Audit (FRA)

Date Written: April 29, 2016

Abstract

A growing body of literature documents how different parties benefit from structured data across the information supply chain. The purpose of this study is to examine the effect of voluntary adoption of the eXtensible Business Reporting Language (XBRL) on price and non-price terms of loan contracting. Using a sample of Belgian private firms, the analyses provide evidence that banks charge lower interest rate spreads to voluntary adopters as compared to non-adopters. The results also show that loan sizes are larger in comparison for voluntary adopters of XBRL. Further, the effect of XBRL adoption is stronger for opaque firms. The results are robust to using different estimation approaches as well as additional tests. The findings are in line with the view that XBRL data filings reduce information processing costs, and contribute to our understanding of the impact of structured data on loan contracting – an implication that may be of interest to regulators and other parties interested in the benefits of structured data across the information supply chain.

Keywords: XBRL, Loan Contracting, Cost of Debt, Interest Rate Spread, Information Technology, Information Supply Chain

JEL Classification: M41

Suggested Citation

Kaya, Devrimi and Pronobis, Paul, The Benefits of Structured Data across the Information Supply Chain: Initial Evidence on XBRL Adoption and Loan Contracting of Private Firms (April 29, 2016). Journal of Accounting and Public Policy, Vol. 35, No. 4, 2016, Available at SSRN: https://ssrn.com/abstract=2450858 or http://dx.doi.org/10.2139/ssrn.2450858

Devrimi Kaya

Ruhr University of Bochum ( email )

Faculty of Management and Economics
Bochum, 44801
Germany

Paul Pronobis (Contact Author)

ESCP Europe - Department Financial Reporting and Audit (FRA) ( email )

79, avenue de la République
Paris, 75011
France

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