Research On Implementation Mechanism Of New Accounting Standards

In 1992, the establishing of Business Accounting Standards- basic norms formally opened a prelude to the construction of accounting standards in china. After more than 10 years'continuous improvement, the Ministry of Finance of China on February 15, 2006 with the enactment of international financial reporting standards convergence, covering various economic enterprises business, independent of the implementation of the new accounting standards system, indicates that the internationalization of China's accounting standards process basically completed. People have great expectations of the new accounting standards and they hope that through new, high-quality accounting standards to improve the quality of accounting information disclosure. Just as all previous accounting rules amendments are intended to regulate, in fact the same for the new regulations provided the opportunity and conditions. The reason is that not only accounting standards have economic consequences, but also the supporting environment in china has no fundamental improvement. Even the United States with high market-oriented and high quality accounting standards, have also exposed the Enron Corporation, the World Telcom etc accounting fraud scandal in recent years, not to mention in China the degree of marketization and quality accounting standards is not high. In fact, solely depend on accounting standards or its supporting environment both can't fundamentally improves accounting information quality. The effective integration of these two aspects has more actual significance. So the perspective is shifted to accounting standards implementation.For the importance of accounting standards implementation mechanisms, scholars and institutions both at home and abroad have talked about from different view. They generally thought that the harmony of accounting standards wouldn't result in the synchronous harmony of accounting practice automatically. Accounting information quality wouldn't be improved solely depend on accounting standards internationalization without regard to the concrete environment of different country. However, different scholars have different view on which factors affect the implementation of accounting standards, the view as follows: corporation governance imperfect, internal control failure, the low level of securities market development, adverse supervision penalties, etc. Basically these affecting factors haven't been combined into a whole. Through analyzing the material changes of new accounting standards and its affecting environment, this paper thinks that the changes are systematic. So the accounting standards implementation mechanism also should be systematic.Construct systematic accounting standards implementation mechanism, first the affecting factors should be found out. Under the restriction of significance principle, the affecting factors are divided into market environment, implementation body, supervision body, legal and informal institution constraints on the base of institution. The division brings forward way and points direction for constructing systematic accounting standards implementation mechanism. Therefore, combine new accounting standards with its affecting factors, broad accounting standards implementation mechanism including three parts is constructed. Accounting standards variance way and its affecting on accounting standards implementation effect is the first part, mainly values the variance way and its effect on accounting standards objectively. The concrete accounting standards implementation is the second part, namely the most important part of this paper. Concrete implementation measures will be discussed in this part. Put forward the concrete conceives of valuing accounting standards implementation effect through appraising accounting information quality is the third part.Concrete implementation measures of accounting standards include three parts. Internal corporation mechanism is the first part. Managers have the most important influence on accounting standards implementation because of its advantageous position in the game with other parties, the advantage roots from its actual control on listed company. Managers not only affect the Board of Director,but also affect the concrete implementation of accounting standards through manipulating internal control. So construct effective corporation governance mechanism to constrain managers'behaviors and internal control to constrain accountants'behaviors is the key of ensuring accounting standards implementation effect. Supervision mechanism outside corporation is the second part. Solely depend on internal corporation accounting standards implementation mechanism can't effectively solve the problem of lasting and serious accounting information quality existing securities market. External supervision is absolutely necessarily in improving accounting information quality because managers'incorrect behaviors will affect market order and result in market failure. So external supervision mechanism regarded as the second defenses line is constructed to ensure accounting information quality. This includes securities market restriction, law supervision, government supervision and CPA auditing supervision. Self-discipline mechanism is the third part. The most highlighted changes of new accounting standards are the importance of professional judgment has been enhanced and fair-value measurement has been adopted within a certain condition. So self-discipline mechanism is constructed based on moral and reputation. Expect accountants'behaviors can be effectively constrained by informal institution.In this paper, the integrated use of institution economics, game theory, and human nature assumptions, contract theory, accounting principles and theory, auditing theory, and many other theoretical knowledge, use combine of Macro-and micro- analysis, statistical analysis, normative analysis, qualitative analysis and quantitative analysis etc. a variety methods, construct a systematic and dynamic accounting standards implementation mechanism. .Two innovations are included in this paper. One is shift the research importance from comparing the differences between new and old accounting standards to discussing new standards'implementation. Another is constructing a systematic and dynamic accounting standards implementation mechanism based on the whole corporation internal control, outside accounting supervision and self-discipline. There also exist two deficiencies because of the restriction of research ability. One is the validity of constructed implementation mechanism hasn't been tested because of new accounting standards'short implementation time and limited scope. This will be the further research direction in order to improve implementation mechanism. Another is the relation between accounting information quality and its affecting factors haven't been further researched. Only discuss the effect of related factors on accounting information quality.