The Research On Accounting Earnings Quality Of Listed Companies In China’s Western Region

Accounting earnings information of listed companies is one of the most important accounting information which is disclosed by the companies. Analyzing the accounting earnings quality about a corporation could guide investors to make rational economic decisions and guide the reasonable flow of capital. What’s more, it can promote the effective resource allocation and improve the public’s confidence in the accounting industry. As China’s capital market development is not perfect, it currently only reach weak form efficiency. The disclosure of accounting earnings information from authorities of business management is in low transparency and there is the possibility of earnings manipulation. Finally these problems lead the investors to make wrong decisions. Therefore, it is necessary to study the accounting earnings quality on listed companies.A great deal of Iiterature in home and abroad are generally studying the accounting earnings quality on the basis of general listed companies and less concentrating on region classification, as a result, the study of the accounting earnings quality is lack of representativeness. As the underdeveloped region, the accounting earnings quality of western China performs its own character inevitably. Since our country carried out the western development strategy, the economic development in the western has encountered the best opportunity; the scale of the listed company is increasingly growing and attracts more investors. However, the vast investors still lack rational knowledge about the accounting earnings quality of western China. Nowadays, the study about the accounting earnings quality of western China is still in blank. Under this background, this article takes the listed companies in western China for sample to research the accounting earnings quality about listed companies in western China. This not only has the important practical significance, but also is the innovation of this article.About the study of this issue, this article uses the method which combines normative research with empirical research in order to realize the complementary advantages of both research methods。 The main part of the article is as follows:First of all, the article defines the concept of the western region and the accounting earnings quality, at the same time, explicits the object of study, and then presents the theoretical basis of accounting earnings quality, namely the decision usefulness objective of accounting theory, capital markets weak form efficiency theory and capital asset pricing models. Then the article reviews and sums up the classic literature of evaluation research on the accounting earnings quality at home and abroad. What’s more, it presents the main criteria for evaluation about the accounting earnings quality.Secondly, use listed companies from the western region as an example. it analyzes the accounting earnings quality in the qualitative aspects. In this part, It introduces the characteristics of the accounting earnings quality and its main criteria for evaluation.At the same time, using listed companies from the western region as an example, considering the development about the accounting earnings quality from the listed Companies in the western region, It gives a Descriptive analysis about this problem and makes contribution to the quantitative analysia in the next part.Thirdly, on the basic of the second part, we begin to make an empirical test to this problem. At first we list the key factors that may influence the accounting earnings quality from the qualitative and quantitative aspects, which involves laws and regulations, government policies, and the daily management, corporate governance and risk control, etc. And then draws lessons from the classical model of return on surplus, combining with the main factors that may influence the accounting earnings quality, we choose nine key indicators which is easy to quantify, and will bring these variables into the classical model of return on surplus, constructing an improved research model. In this part, we select the financial data from2008-2010which comes from the listed companies in Shanghai Stock Market from the western region as a sample.But the sample eliminates the financial listed companies, ST listed companies, and the incomplete financial data of listed companies. At last, the126samples are adopted. Through empirical study, we found that the accounting earnings quality of the listed companies in western region has a larger correlation between the five factors which are stock, the main business profits, asset impairment loss, sales and administrative expenses, the audit opinion. However, other influence indicators are not significant.At last, according to the results of empirical research and the found problems, the article puts forward some achievable policy proposals in order to improve the levels of accounting earnings quality of the listed companies from the Western Region, which mainly including three aspects, such as improving laws and regulations and market supervision, improving their own management level, improving the quality of the investors and strengthening the supervision of the social public.