Small business need-to-know and news-to-watch……
Excerpt…….A main message of our paper is that discretion over bank loan loss provisioning is a double-edged sword. While discretion may facilitate incorporation of more information about future expected losses into loan provisioning decisions and mitigate pro-cyclicality, it also increases potential for opportunistic accounting behavior by bank managers that can degrade bank transparency and lead to negative consequences for the discipline of bank risk-taking
Read full article……..via Accounting Discretion, Loan Loss Provisioning and Discipline of Banks’ Risk-Taking — The Harvard Law School Forum on Corporate Governance and Financial Regulation.
