The Legal Implications of Off Balance Sheet Financing: A Comparative Analysis of UK and US Positions

2.50
Hdl Handle:
http://hdl.handle.net/2436/17614
Title:
The Legal Implications of Off Balance Sheet Financing: A Comparative Analysis of UK and US Positions
Authors:
Yeoh, Poh Seng (Peter)
Abstract:
Off balance sheet financing (OBF) is either not visible or only partially visible in financial reporting for a number of reasons. It has attracted controversy in the light of its employment in a number of major corporate scandals. Previous investigations dominated by short works and consultancy papers have focused mainly on the financial aspects of OBF. This academic cross-country research on the use of OBF in the UK and US capital markets was undertaken to extend the published analyses to include a legal perspective by studying its legal implications for directors, financial advisers, auditors and financial regulators. The study’s legal focus prompted relying primarily on the doctrinal approach, which was in turn completed by the use of a modified case study in order to help address the how and why issues of the research phenomenon. The study found that OBF instruments are double-edge financial instruments with good and bad consequences. When corporations used OBF for liquidity enhancement or to realise financial savings, they result in positive outcomes. In contrast, when used for aggressive window-dressing or in the manipulation of financial reporting for fraudulent ends, OBF mechanisms generated serious legal liabilities for directors, auditors, and financial advisers in terms of compensation suits or even criminal sanctions. Financial regulators were nonetheless found to be less likely to face legal consequences as a result of current judicial attitudes on the tort of public misfeasance. However, the extensive applications of OBF in conjunction with other forms of creative accounting have resulted in various regulatory responses. On a comparative note, litigation and enforcement actions were found to be relatively more extensive in the US because of the higher incidence of large corporate frauds and the work of regulatory champions especially in New York using deferred prosecution agreements.
Publisher:
University of Wolverhampton
Issue Date:
2007
URI:
http://hdl.handle.net/2436/17614
Type:
Thesis
Language:
en
Description:
A thesis submitted in partial fulfilment of the requirements of the University of Wolverhampton for the Degree of Doctor of Philosophy
Appears in Collections:
E-Theses

Full metadata record

DC FieldValue Language
dc.contributor.authorYeoh, Poh Seng (Peter)-
dc.date.accessioned2008-02-06T09:44:44Z-
dc.date.available2008-02-06T09:44:44Z-
dc.date.issued2007-
dc.identifier.urihttp://hdl.handle.net/2436/17614-
dc.descriptionA thesis submitted in partial fulfilment of the requirements of the University of Wolverhampton for the Degree of Doctor of Philosophyen
dc.description.abstractOff balance sheet financing (OBF) is either not visible or only partially visible in financial reporting for a number of reasons. It has attracted controversy in the light of its employment in a number of major corporate scandals. Previous investigations dominated by short works and consultancy papers have focused mainly on the financial aspects of OBF. This academic cross-country research on the use of OBF in the UK and US capital markets was undertaken to extend the published analyses to include a legal perspective by studying its legal implications for directors, financial advisers, auditors and financial regulators. The study’s legal focus prompted relying primarily on the doctrinal approach, which was in turn completed by the use of a modified case study in order to help address the how and why issues of the research phenomenon. The study found that OBF instruments are double-edge financial instruments with good and bad consequences. When corporations used OBF for liquidity enhancement or to realise financial savings, they result in positive outcomes. In contrast, when used for aggressive window-dressing or in the manipulation of financial reporting for fraudulent ends, OBF mechanisms generated serious legal liabilities for directors, auditors, and financial advisers in terms of compensation suits or even criminal sanctions. Financial regulators were nonetheless found to be less likely to face legal consequences as a result of current judicial attitudes on the tort of public misfeasance. However, the extensive applications of OBF in conjunction with other forms of creative accounting have resulted in various regulatory responses. On a comparative note, litigation and enforcement actions were found to be relatively more extensive in the US because of the higher incidence of large corporate frauds and the work of regulatory champions especially in New York using deferred prosecution agreements.en
dc.language.isoenen
dc.publisherUniversity of Wolverhamptonen
dc.subjectOff balance sheet financingen
dc.subjectSecuritisationen
dc.subjectSpecial purpose entityen
dc.subjectFinancial regulationen
dc.titleThe Legal Implications of Off Balance Sheet Financing: A Comparative Analysis of UK and US Positionsen
dc.typeThesisen
dc.type.qualificationlevelDoctoral-
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