Research On The Influence Of The Accounting Transparency For China’s Small And Medium Listed Companies

On May17,2004, the SME board in Shenzhen Stock Exchange formallyestablished, it marks the official start of the second board market. And smallbusinesses have their own financing channels. In recent years, small board markethave rapid development and improvement both from the number and the scale.However, the accounting transparency of small board listed companies is notsatisfactory. Due to the lack of transparency of accounting information, themanipulation in securities market and the insider trading is widespread. The quality ofaccounting information is worrying. Especially in these years, minority shareholders’activism due to the deficient transparency of the accounting information misleads theinvestors and harms their interest.In a theoretical sense, by the method of combining normative and empiricalresearch, to explore the influencing factors that affect accounting transparency of thesmall board listed companies. It is a basis for establishing a comprehensiveaccounting transparency evaluation system; In a practical sense, a high level ofaccounting transparency can solve the problem of asymmetric information betweenlisted companies and investors, and to protect the interests of investors. Therefore, itis of great importance to find out the factors which gives rise to the accountingtransparency.This paper firstly talks about the background of the research, final objective, andthe research methods. Relevant documents from China and abroad are reviewed aswell. Based on the previous relevant work, and combined with Chinese institutionalbackground, we started the study about the factors that affect accounting transparencyof listed companies. And then, we analysed the factors that may affect accountingtransparency from three aspects: corporate finance, corporate system environment andexternal supervision, internal supervision. Finally, we take the medium and smallenterprises listed in Shenzhen stock market during2007-2011as samples to illustrateour experiment.13explanatory variables are selected in our empirical research and the result ofaccounting information disclosure quality evaluation released from Shenzhen stockmarket is chosen as our explained variable. After descriptive statistical analysis, wedid the correlation test. Then we did Multiple colinearity test to avoidMulticollinearity problems. Finally, logistic regression analysis were used to further study the influencing factors on the impact of accounting transparency. It can be seenfrom the results that the company’s financial affairs play a vital role in the accountingtransparency of the medium and small listed companies;one person has two positionin a company and the special treatment have a negative impact on accountingtransparency;the independent director system and accounting firms have limitedinfluence on the accounting transparency;the diligence of the medium and smalllisted companies’ board、the establishment of the Audit Committee、the legalenvironment and the government intervention have nothing to do with the accountingtransparency. After the empirical research, the reasons are analysed based on theexperiment results and then relevant suggestions are concluded for the medium andsmall listed companies in order to improve the practical monitoring work in thefuture.