Publication

The Impact of Text-Based Financial Constraints on Stock Price Crash Risk: Evidence From the UK Firms

Acheampong, A.
; ; 
Gozgor, Giray
; 
Yeboah, P.
Publication Date
2025
End of Embargo
Supervisor
Keywords
Financial constraints, IFRS adoption, Stock price crash risk, Textual analysis, UK firms
Rights
(c) 2025 Wiley. This is the peer-reviewed version of the following article: Acheampong A, Mousavi MA, Gozgor G et al (2025) The Impact of Text-Based Financial Constraints on Stock Price Crash Risk: Evidence From the UK Firms. International Journal of Finance and Economics. xx(xx), which has been published in final form at https://doi.org/10.1002/ijfe.3113. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Self-Archiving.
cb
Peer-Reviewed
Yes
Open Access status
embargoedAccess
Accepted for publication
2024-12-30
Institution
Department
Awarded
Embargo end date
2027-01-08
Collections
Management and Law Publications
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Files
acheambong_et_al_2025.pdf
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Additional title
Abstract
This paper employs a textual analysis approach to quantify financial constraints information from the narrative sections of annual reports in the UK firms. Then, the paper examines the impact of this information on the stock price crash risk in 250 firms from 2005 to 2021. The paper also analyses the moderating role of adopting the International Financial Reporting Standards (IFRS) on the impact of text-based financial constraints on stock price crash risk. It is found that text-based financial constraints are positively associated with stock crash risk measures. It is also observed that adopting the IFRS weakens the positive impact of financial constraints on stock price crash risk. These results are robust to several controls and model specifications. The findings also have several implications for investors and other market participants for seeking evidence of the credibility of annual reports in reflecting relevant information that highlights financial constraints.
URI
http://hdl.handle.net/10454/20221
Version
Accepted manuscript
Citation
Acheampong A, Mousavi MA, Gozgor G et al (2025) The Impact of Text-Based Financial Constraints on Stock Price Crash Risk: Evidence From the UK Firms. International Journal of Finance and Economics. Accepted for publication.
Link to publisher’s version
Link to published version
Link to Version of Record
https://doi.org/10.1002/ijfe.3113
Type
Article
Qualification name
Notes
The full-text of this article will be released for public view at the end of the publisher embargo on 8 Jan 2027.