Research On The Economic Consequence Of Accounting Policy Choice In Listed Companies

The right of accounting policy choice is the natural product under the level of the accounting theory and the framework of the system. It is a decision-making and it is definitely affecting the way of the information outputs of the accounting system.These dicisions can be considered from a strategic perspective and be used as a long-term policy.These can be considered from a short-term perspective and be used as a strategy to control revenue and the generation of accounting information.Listed companies use this option to change their accounting policy to influence all stakeholders.At first,this article definites accounting policy and classify accounting policy from macroscopic and microcosmic perspective.Then this article analyzes the motivation and influence factors of different accounting policy choice under the enterprise contract theory.Because of the controversy of non-effect hypothesis and mechanical hypothesis,this article afraid that the imperfections of our present stock market and the non-rational investors cause non-effect hypothesis' defection.And information asymmetries originate these theory.This article analyzes the short-term and long-term market effect by using event research method, purchase and holding method and cross-section regression analysis. In the event research method, three time windows are chosen: a. from 10 days before publishing accounting change to 10 days after publishing day; b. from 10 days before publishing accounting change to publishing day ;c .from publishing day to 10 days after publishing day, to research the short-term market effect of accounting policy choice. By using purchase and holding method to judge the long-term market effect of accounting policy choice.And conclude that:accounting policy choice has its economic consequence in both long-term and short-term.The regression conclusion indicate that the information quality of the group of increase profit is lower than others.