External Supervision, Managerial Over Confidence And Accounting Conservatism

Accounting conservatism as an important measure of the quality of accounting information, has always been a hot issue in the academic exploration. It has abandoned the view put forth by Adam Smith "rational economic man", from behavioral finance "non rational economic man" theory, to China’s Shanghai and Shenzhen main board listed company 2012-2014 4983 sample data as the research object, explore the effects of Managerial Overconfidence on corporate accounting conservatism measure accounting conservatism, on the basis of the former research divided into two big classes of conditional conservatism and unconditional conservatism. The multiple regression equation was established and the data were processed by the data processing software Stata. The correlation between the independent variables and the dependent variables was analyzed. Empirical results show that managerial overconfidence and accounting conservatism is significantly negative correlation, in order to weaken the adverse effect this dissertation added explanatory variables external supervision, this empirical test the influence of external supervision of the managerial overconfidence and external supervision of the this negative correlation effect in alleviating the. Empirical results show that with a certain intensity of external supervision can reduce management overconfidence level, and strict external supervision can counteract, the overconfidence of management on Accounting Conservatism negative correlation is positive correlation. This study not only enriches the behavioral finance theory, but also provides the direction for the improvement of enterprise accounting conservatism.