The Relationship Among The Information Disclosure, Earnings Management And The Cost Of Capital

This paper quoted inofrmation disclosure degree to explain the disclosure of information,and then research the relationship between information disclosure degree and earningsmanagement behavior by analysis the2005-2009data of a listed company. Based on thesummary of earnings management means, put forward to should plan the amount of the projectas inspection standards measure of earnings management, put forward to this paper ifrsthypothesis improving the disclosure quality and earnings management behavior whethernegative changes.And a summary of information disclosure in the capital market effect, assumed that when a’companys cost of capital is high, otfen financing is more dififcult, in order to reduce the cost ofcapital, the enterprise eanrings management motive is stronger, this kind of companyinformation disclosure is otfen low. Perhaps say, enlerprise information disclosure degree islower, outside investors and internal management of the information asymmetry that existsbetween more and more seirous, in order to protect their investment security, external investorst"end to credit crunch", or require a higher return on investment as compensation for irsk, itcauses the enterprise ifnancing dififculty and the cost of capital increase. In order to get morefinancing and reducc the cost of capital, the enterprise will otfen have a strong motivation forearnings management, due to the existence of asymmetric information, internal managementusing their own information advantage, earnings management，proposes the hypothesis two: thecost of capital higher company, eanrings management motivation is stronger, the extent ofinformation disclosure is lower.Finally, according to the main findings, make clear the relationship among the informationdisclosure, earnings management and the cost of capital.Namely the enterprise to reduce thecost of capital is to improve earnings management, earnings management improvement willundoubtedly reduce information disclosure level, we should how regulatory informationdisclosure, namely whether to improve the corporate govenrance behavior, to improve theaccounting information to reduce eanrings management behavior, attracting more rationalinvestors to improve the company’s management level.