Property Rights,Audit Quality And Debt Financing Costs

Since the last century,social auditing has served as a bridge between the creditors and the debtor.On the one hand,the development of China's stock market is limited and there are various restrictions in the capital market,direct financing from the capital market can not meet the enterprise's financial needs;on the other hand,the debt financing can be deducted from the company's pre-tax profits,often said that the "interest tax credit",so the debt financing has become the most important financing channels for enterprises in China.How to better play the role of information bridge is related to the healthy and orderly development of the audit industry.Corporate finance is to strive for more debt financing and lower debt capital costs,and financial information must be objective and reliable,to allow creditors to understand the business of the financial situation.But how can we take measures to ensure the objectivity and reliability of their own information? Creditors in order to make their own rights and interests must be guaranteed to know the objective and financial information,so the creditors need an independent third party as a bridge of information,social audit in the debt financing market has the function of information transmission.So far,there are a lot of research on audit opinion,but there are still few thematic studies on the type of audit institution and the cost of corporate debt financing.The explanatory variable chosen in this paper is the explanatory variable,that is,the social audit institution ranking is the top ten and whether it belongs to the audit industry expertise,it represents the creditor of its report on the degree of recognition of the size of the social audit institutions if the top ten accounting firms and auditors with expertise in the accounting profession,then issued by the greater degree of recognition of the report;the contrary,if the social audit institutions do not belong to the top ten accounting firms and accounting firms with expertise in the audit industry,then the report issued by the smaller degree of recognition.Do not choose the type of audit report as an explanatory variable,which is due to the type of non-standard report issued by the company is not much,so the type of social audit report and the cost of debt capital is not much theoretical and practical significance.The research on the impact of audit quality on the cost of debt capital under different property rights is also relatively little.The contribution is to make up for the theoretical literature of these aspects.This paper is based on the information asymmetry theory analysis,debt contract theory,property rights theory analysis,using 2008 to 2015,Shanghai and Shenzhen A-share listed companies as a sample of data,to take descriptive statistical analysis of variables,multivariate correlation analysis,multiple regression analysis.This paper analyzes the relationship between the nature of property rights,the quality of audit and the cost of debt financing.Firstly,it studies the effect of audit quality on the cost of corporate debt financing.On this basis,it verifies the audit quality to debt financing costs under the background of different property rights.The empirical results show that the audit quality is negatively correlated with the cost of debt financing.After controlling the size of the company,the scale of liabilities,the long-term debt ratio,profitability,solvency,growth capacity,total asset utilization efficiency,equity multiplier,operating cash flow,fixed asset ratio,industry factors and annual factors,audit quality and corporate debt financing costs are negatively correlated,in other words,when other conditions are the same,if the listed company is audited by firms with high audit quality,the company's debt financing costs will be reduced by high-quality accounting firms.After examining the above,we also study the impact of audit quality on the cost of debt financing under the background of different property rights.