Research On Relativity Between Choice Of Accounting Policy And Accounting Information

Choice of accounting policy is a process that managers of enterprises make choice of given accounting principles,methods and procedures in the range which is permitted by accounting rule,to reach the given purpose.The premise of choice of accounting policy is that accounting principles,methods and procedures are optional,this kind of optional comes from the flexibility of accounting rule.The reasons why accounting rule is flexible are listed as below:First,human can not establish the accounting rule which is coincident with complicated accounting practice because of the limited loqos of human;second,supposing human can establish the accounting rule,the exorbitant cost of establishing and fufiling makes it be impracticable.With the reasons of choice of accounting policy's produce, choice of accounting policy could be divided into three main forms:enforceability choice,marketability choice and spontaneity choice.The accounting rule(CAS28) that is carried into execution resently about the alteration of accounting policy basically incarnates the idea.What the laws and accounting rules rquire belongs to enforceability choice;and what could reliably provide correlative information about financial status,result of operation and cash flow belongs to spontaneity choice.Apparently, casual controls that may lead to artificially ill-natured accounting information can not be considered as choice of accounting information absolutely.Choice of accounting policy is a dynamic process,enterprises should make timely and effective changes according to economical change,it exits in a complete course which includes several elements, such as the measurement,the notes and the reports,not only including accounting techniques and methods.Because choice of accounting policy of enterprise inevitably brings some changes,such as expense,cost,income,interest,asset value and government revenue,finally leads to economical result that social wealth would be distributed again.So the nature of choice of accounting policy is practically adjusting of social benefits.Whether it could be controlled and ruled effectively, not only is important to quality of enterprise's accounting information,but also has important effect on good development of national economic.In light of defaults of accounting theory's research, Watts and Zimmerman(1986)made use of contract theory of economics to research accounting,and with the core that is contract cost,set up"Positive accounting theory"of which the main research content is choice of accounting policy. Watts and Zimmerman believed that the primary motivation that managers of enterprise make choice of accounting policy is about contract purpose and political purpose; after Watts and Zimmerman(1986),many persons believed that the motivation that managers of enterprise make choice of accounting policy also includes capital market purpose except contract purpose and political purpose.This thesis make it be pilot,firstly it analyzes the basic theory of choice of accounting policy, then it gives deeply explanation about how choice of accounting policy and accounting information produce great effect to each other, and the unity between reasonable choice of accounting policy and high-qualified accounting information.And this article gives examples to analyze the relationship between accounting information and choices of accounting policy including depreciation of fixed assets,merchandise pricing,preparation of assets,it also makes use of actual cases in explaining the effects that are brought to accounting information by different choices of accounting policy,also explaining that accounting information which we have obtained can affect the decision-maker working out different choices of accounting policy.It also puts forward some principles,measures to standize choice of accounting policy and improve quality of accounting information,for example perfecting market laws and lawsuit system;energetically developing market medi-institution;swelling diaphaneity of market;strengthening audit supervising mechanism of CPA;enhancing normal construction of displaying accounting information and so on.At present, modern enpterprise's rules which is improved in our country requires that more free right of choosing accounting policy should be given to enterprises . But the result of the research about the current situation partly testifies that choice of accounting policy in our country leads to manipulating profits and whitewashing forms.During this period, the quality of our country's accounting information is not good, even some information of several enterprises is really false. This situation has become a large obstacle that prevent economy in our country from developing. The main field for the development of accounting in future is that we should realize the relationship between choice of accounting policy and accounting information and deal with it correctly,the subject of the thesis is the result of this kind of causation.This essay does not just discuss the problem from the view of choice of accounting policy, while it discuss from the view of the relationship between choice of accounting policy and accounting information.Choice of accounting policy is the foundation of how to reveal accounting information.The policy can produce profound effect to accounting information.Accurate accounting information can have active influence on choice of accounting policy, while false information can produce negative effect to choice of accounting policy.The relationship between choice of accounting policy and accounting information is gradually becoming hot point of theory research in our country.However, current research is still in the early period.On the basis of achievements that other people have got, this essay has come up with a new view about relationship between choice of accounting policy and accounting information.This article discusses the basic theory of choice of accounting policy from different angles,such as contract theory,supply and demand theory,economical sequel theory,game theory and so on.From establishment of rule,use of accounting information,it also discusses impersonal inevitability of choice of accounting policy.