Research On The Implementation Effect Of Segment Report Standards

With the continuous development of global economy and the integration of pattern gradually formed,many enterprises break through the traditional single operating areas and geographical range tocross-border、cross-industry、trans-regional and diversified business direction. If the enterprise is only in theconsolidated financial statements to reflect the financial situation, that will occults internal division ofimportant information, so that the information users can not understand enterprises in different industries,different regions of the level of profitability, growth trend and risk. The apparition of segment report justremedies this situation. The usefulness of segment information in the securities market makes thedisclosure and normative studies of it more and more.《China Accounting Standards No.35--SegmentReport》(CAS35) has been implemented for several years, there are few domestic articles to study its effectcompletely and systematicly. This paper attempts through empirical research methods,from the informationof the“quantity”and“quality”two angle detection of CAS35to detect its implementation and effect. Thisarticle is divided into following parts:The first part is the introduction, describes the research background and research significance and theresearch thought and method, puts forward the research theme of this thesis--Research on the effect ofsegment report standards.The second part is the literature retrieval of segment report, reviewing and evaluating segmentreporting of domestic and foreign literature, analysing the domestic and foreign research status of segmentreport.The third part is the segment report outline, from the segment report preparation and disclosure twoaspects respectively to introduce the segment report basis、segment division、identification of the division、report disclosure rules and disclosure forms, and based on the information economics of “excellenttheory”、asymmetric information theory and the efficient market theory as the theoretical basis of thearticle.The fourth part is the standard of segment report on the implementation of statistical analysis, mainly from the information “quantity”angle it analysis whether to increase the information content after segmentreport standards carrying out. According to the rules of the proposed FASB improvement standards, thischapter design three research problems:(1)What is the form of segment reporting under CAS35?(2)Whetherthere are more reportable quantities after CAS35?(3)Whether the segment information disclosure level ofdetail enhanced after CAS35? According to the three research problems this article analyzesShanghai-A-share to report the situation changes between2004and2009years, founding the enterprises ofcontinuing to disclose segment report accounted for low; many enterprises according to business as themain segment report forms; it does increase the segment information content after CAS35.The fifth part is the standard of segment reporting of the implementation of empirical analysis,analyzing whether the information quality is improved after CAS35mainly from the information of“quality” of the angle. This chapter will groupe enterprises according to the report of unity and diversity,and extracts from three samples of enterprises:(1)pre-35disclosed a single division and post-35disclosedmultiple division of the enterprises;(2)pre-35and post-35are disclosed multiple division of thecompanies;(3)pre-35and post-35are disclosed a single division enterprises, analyzing the regression resultsof the three sets of data, the conclusion shows that China’s securities market does have information content;CAS35make the accounting information has been improved, increasing the usefulness of accountinginformation.The sixth part is the conclusion and policy proposal,this chapter mainly results from the study of thestandard of segment reporting environment and the implementation of the guidelines themselves twoaspects to improve the standard of segment reporting recommendations. The standard guidelines for theimplementation of environmental recommendations include:(1)Strengthen CPA in the audit process tosegment report concerns the degree;(2)Maintain market regulators and standard setting bodies to work inharmony;(3)Strengthen the accounting personnel of the segment report standard study,improve standards oftheir own proposals include:(1)Specific the aim of segment report;(2)Improve the content of thedisclosure;(3)Clear industry concept.The main contribution of this paper is studing the implementation of the CAS35Comparatively,founding it increases the content of information in accounting, and improves the accounting information topredict future earnings ability; in addition, establishing the disclose projects’ standards of grading can quantify the segment information disclosure level of detail, to reflect segment information disclosurequality changes more intuitively. The deficiencies of this paper lies in the sample data is limited, thesamples are collected manually, the business segment report is not very standardized, so that dope somesubjective judgment in statistical process inevitably, affectting the study conclusions’ accuracy; in addition,this article only research the business segment report, lack of regional segment report’s research; at last,this article does not consider enterprises listed years, government intervention in the economy as well as theproportion of institutional ownership and some other factors, this may affect the accuracy of results.