What is it about?
Since 2015, balance sheet-based covenants started to vanish, especially from private debt contracting. We tried to correlate borrowers and their likelihood in using balance sheet-based covenants. The correlation between the change in accounting standard setting and the concurrent change in trend of choosing accounting-based covenants in debt contracting is being investigated. The results are consistent with our hypothesis.
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Why is it important?
A mechanism that separates multiple covenants and correlates them with significant debt characteristics will be an innovative tool for managers and credit institutions, as well as a more definite way of auditing, for instance, by digitalizing it, which will be a great tool for everyone involved in businesses.
Perspectives
Extent research should be made in the area of consequences and reasons for changing trends in debt contracting
Mr Nikolaos A. Kalantzopoulos
International Hellenic University
Read the Original
This page is a summary of: Greek Accounting Standards and Debt Covenants. Changes in Contracting, KnE Social Sciences, February 2023, Knowledge E,
DOI: 10.18502/kss.v8i1.12652.
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