Study On The Correlation Between Accounting Information Of Correction Notice And Corporate Governance

Annual financial statements is one of the most important information sources for investors to learn corporate financial position and operating results, whose credibility and relevance are paid attention to all the time. However, annual financial statements patch as supplement and correction of the financial statements proves that there are omissions or mistakes in early statements. What's worse, the managers can use annual financial statements patch to delay the disclosure of negative information, which reduces the information quality of financial statements and has an effect on investor's decision-making. Especially the disclose of correction notice of annual financial statements will cause the negative market reaction and great economic losses to investors.Although there are some theoretical results on annual financial statements patch in the world, few study about this phenomenon at home, particularly in empirical research。This paper gets the conclusion that annual financial statements patch of listed company has some defects in timely disclosure, authenticity and reliability. Meanwhile, correction notice shows that there are some serious problems in information quality about disclose of annual financial statements, especially the earnings adjustment, which reveals the existence of some listed companies manipulate earnings deliberately. Accounting information quality and corporate governance is closely related. This paper gets these findings by the empirical research on the association between correction notice and corporate governance:company of equity moderate concentration less publishes a correction notice; equity highly dispersed company more easily publishes a correction notice, and all through the test of significance. That is, moderate concentrated equity is helpful to keep balances the interests between large shareholders and small shareholders, to improve the efficiency of corporate governance, thereby enhancing the quality of accounting information. Whereas raising institution investor's shareholding proportion can improve corporate governance structure. The study also found that there is a significant positive impact on that the number of independent directors and the four independent directors committee can reduce t the probability of correction notice, which proves that more independent directors and the sound of four committees can strengthen supervision and constraints to the management of listed companies, making much more standardized and improved internal governance, and thus improve and enhance the quality of accounting information.