Research On The Relation Between CFO Gender And Earnings Quality Of Listing Companies

Earnings quality issue has been highly concerned by theoretical and empirical,because the level of earnings quality directly affects the decisions of stakeholders,high earnings quality can reflect better real economic activities, pass out morevaluable information, according to the valuable information, the stakeholders offinancial decision which can make the right decisions, however, recently, a series ofevents of financial fraud and excessive earnings management have occurred at homeand abroad, indicating that the low quality of earnings has become a worldwideproblem, therefore how to improve earnings quality, protect investors and creditorsinterests should be taken seriously. CFO is chief financial officer, and originated inthe1970s in some Western countries, CFO as the person who directly responsible forfinancial reporting, and occupy a very important position in the company’s executiveteam, they are not only the important strategic decision-maker of the company butalso the executor of strategic decision of the company. They are the person whodeliver companies’ information, have a great deal of information superiority in theprocess of transmission of information, so their behavior plays an important role infinancial reporting quality. This paper mainly connects CFO gender with earningsquality, by studying the relationship between the CFO gender and earnings quality toimprove earnings quality.In this paper, it is based on CFO gender of listing companies from year2008to2011as data samples for analysis. Study on the correlation between CFO gender andearnings quality, according to accrual quality and earnings smoothness measuringearnings quality, this paper analyses the correlation between CFO gender and accrualquality, earnings smoothness.Firstly, the proportion of female CFO annual distribution, accrual quality,earnings smoothness of these three areas were descriptive statistical analysis.Statistical results show that the proportion of female CFO is gradually increasingtrend, this means that more and more listed companies start to pay more attention tothe effect of female CFO in the company. Compared to male CFO, female CFO makedecisions associated with the handling accrual profit more cautious and conservative,and female CFO have a higher level of business ethics, female CFO have lowerearnings smoothness. Secondly, by using OLS least square method and logic regression analysismethod, this paper makes empirical analysis of the model of accrual quality andearnings smoothness, tests the relationship of CFO gender and earnings quality, thestudy found that: CFO gender and manipulated accrual quality are negativecorrelation, CFO gender and earnings quality are positive correlation, compared tomale CFO, the companies of female CFO have less earnings smoothness.Finally, according to the conclusions of the study, it is suggest that we shouldimprove CFO system, break the “glass ceiling” effect, increase the proportion offemale CFO, and put the gender differences into the strategic decision of enterprise.