Study On The Existence And Motivation Of Accounting Conservatism

Conservatism is not only an important part of the qualitative characteristics of accounting information,but also an effective corporate governance mechanism.It has important significance for guiding the development of accounting system and accounting practice.Because the conservatism has been studied for less than twenty years,many associated problems have not yet been resolved. This thesis attempts to provide empirical evidences for the accounting conservatism studying as well as to provide some enlightenment for governments, enterprises and investors and other users of accounting information.The sample of this study is the relevant data of Shanghai and Shenzhen A-share listed companies between 2002 and 2009. The models of this study are Basu model(1997) and its improved ones. Through the empirical analysis, this paper obtains the following conclusions:The accounting conservatism wholly exists in Chinese accounting information,and it is not caused by the "big bath" of loss company.There is industry characteristic in the accounting cconservatism of China.The changes of mandatory Accounting Standard have limited impact on accounting conservatism.The Accounting Standards of 2007 have no significant impact on the accounting conservatism of listed companies.The different ownership structure and different debt size lead to different levels of conservatism.The significances of this study are as follows:From the perspective of regulators,accounting standards play limited role on improving the quality of accounting information,multi-party co-operation is needed in order to effectively improve the quality of accounting information.From the perspective of company,the higher the level of internal governance, the higher the accounting information quality will be, so the company should effectively improve the internal governance mechanisms.