Financial Accounting Information And Top Managerial Incentive

This dissertation primarily researches on the usefulness of financial accounting information in the managerial incentive plan. As an important means to protect the benefit of outside investor, the usefulness of financial accounting information is to eliminate the asymmetry information between the outside and inside of enterprise, which depends on efficiency of evaluating the top managerial performance.Firstly, chapter 1 introduces the aim, theoretical base and significance of this dissertation. In chapter 2, I review the history of top managerial incentive and take WanKe corporation for example to explain it. In chapter 3, the dissertation mainly researches on the usefulness of cash flow and accrual term in evaluating top managerial performance, afterward the dissertation researches on the different role of discretional accrual and non-discretional accrual, the conclusion shows the non-discretional accrual play the main role. In chapter 4, the dissertation constructs a model from stakeholder perspective to test the effectiveness of relative performance evaluation, the result shows that only from staff and shareholder perspective the PRE is effectiveness of weak form. At last, the dissertation analyzes the contribution and deficiency, meanwhile makes some suggestion to improve it.