The purpose of this study is to examine the influence of the readability of annual reports on firms’ ability to obtain trade credit from suppliers. Particularly, the authors conjecture that annual report readability helps firms obtain more trade credit from suppliers.,The authors use the Gunning Fog Index as the primary measure of annual report readability and the ratio of accounts payable to the book value of total assets as the measure of trade credit.,Results from the study of 4,754 firms during the 2004–2016 period indicate that suppliers extend more trade credit to firms with more readable financial reports. The authors’ results are robust to alternative measures of trade credit and annual report readability. The authors’ results remain robust when we control for firm fixed effects and potential endogeneity problems using the instrumental variable approach. A further test shows that the level of trade credit is higher for firms in business service industries, and that this relation is weakened when firms disclose less readable 10-K filings.,The authors’ findings provide new insight into the role of financial report readability in firms’ ability to obtain trade financing from suppliers. The authors’ results are also in line with the SEC’s encouragement that firms use plain English and easy language in financial reporting.

中文翻译：

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年度报告的可读性和贸易信用

本研究的目的是检验年度报告的可读性对公司从供应商那里获得贸易信用的能力的影响。特别是，作者推测年度报告的可读性可以帮助公司从供应商那里获得更多的贸易信用。作者使用古宁雾指数作为年度报告可读性的主要度量，而应付账款与总资产账面价值的比率作为度量2004-2016年间对4,754家公司的研究结果表明，供应商向财务报告可读性更高的公司提供了更多的贸易信贷。作者的结果对替代贸易信贷和年度报告可读性的衡量方法是可靠的。当我们使用工具变量方法控制牢固的固定效应和潜在的内生性问题时，作者的结果仍然很可靠。进一步的测试表明，商业服务行业中公司的贸易信用水平较高，并且当公司披露可读性较低的10-K文件时，这种关系被削弱。作者的发现为财务报告可读性的作用提供了新的见解。公司从供应商那里获得贸易融资的能力。作者的结果也符合SEC的鼓励，即公司在财务报告中使用简单的英语和简单的语言。作者的发现为财务报告可读性在公司从供应商那里获得贸易融资的能力中的作用提供了新的见解。作者的结果也符合SEC的鼓励，即公司在财务报告中使用简单的英语和简单的语言。作者的发现为财务报告可读性在公司从供应商那里获得贸易融资的能力中的作用提供了新的见解。作者的结果也符合SEC的鼓励，即公司在财务报告中使用简单的英语和简单的语言。