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Campbell, J. L., Cao, S. S., Chang, H. S., & Chiorean, R. (2023). The Implications of Firms’ Derivative Usage on the Frequency and Usefulness of Management Earnings Forecasts. Contemporary Accounting Research, 1-37.

has been cited by the following article:

• TITLE: Does the Derivatives Usage Affect Corporate Capital Expenditure? Evidence from China

  AUTHORS: Guiling Zhang, Zhaoqi Guo, Jianing Liu, Zheng Wang

  KEYWORDS: Derivatives, Capital Expenditures, Risk Management, Borrowing Capacity, Corporate Value

  JOURNAL NAME: American Journal of Industrial and Business Management, Vol.13 No.11, November 27, 2023

  ABSTRACT: Based on hand-collected data of financial derivatives in listed firms of China, this paper discusses the impact of derivative usage on capital expenditures in emerging markets. It is found that the capital expenditure of derivative users is lower than non-users, and the mechanism is that derivative usage reduces the company’s borrowing capacity. The results remain robust after the test of sensitivity test and control of endogeneity. Further research shows that the higher derivative usage intensity, the lower the capital expenditure; The implementation of accounting standards such as Fair Value Measurement has mitigated the adverse impact of derivative usage on capital expenditures; The effect of using derivative to reduce capital expenditures mainly occurs in non-SOEs. From the perspective of economic consequences, the corporate value of derivative users is lower, and the change of derivative accounting standards helps to alleviate the adverse impact of derivatives on corporate value.