A Study On The Effect Of Integrated Reporting

Since the global financial crisis in 2008,there has been a growing demand of the public for reducing the complexity and improving the ability in risk warning and decision making of corporate reports.At the same time,with the constant concern about the global warming,resource depletion and other environmental issues,as well as the increasing attention to corporate social responsibility because of the continuous exposure of the food safety problem,employee rights and other social responsibility issues,the importance of relevant non-financial information is becoming more and more prominent.The traditional reporting model on which organizations could only report financial issues has already been inadequate to meet the information needs of various stakeholders.In order to both meet the requirement of adequacy and prevent the information overload resulted by the release of multiple reports,people put forward the concept of “integrated reporting”,which means effectively integrating the financial information and non-financial information together into one report,to make up for the shortcomings of the existing reporting system and improve the efficiency of resource allocation.What is the effect of integrated reporting as a new corporate reporting model? In order to test this problem,based on the follow-up quality of the integrated report after enforcement,this paper makes use of the empirical evidence of compulsive integrated reporting regulation in South Africa since 2010,and analyses the impact of integrated report quality on value relevance of accounting information and investment efficiency,to research the effect about implementing integrated reporting from the aspects of information benefit and economic benefit.This paper is comprised of six parts: The first part is an introduction,mainly introducing the background and significance of this paper,summarizing the research methods,thinking,main content and framework,and pointing out the innovation of this paper.The second part is a literature review,including three aspects of the research literature on integrated reporting,value relevance of accounting information and the connection between corporate information disclosure and investment efficiency.The third part includes theoretical analysis and research hypothesis.Firstly,it defines the concepts of integrated report,value relevance of accounting information and investment efficiency.Secondly,it expounds the theoretical bases of the correlation between integrated report quality,value relevance of accounting information and investment efficiency,which includes the information resource allocation theory,stakeholder theory,asymmetric information theory,etc.Finally,it puts forward the hypothesis based on the theoretical analysis.The fourth part mainly explains the sample selection and empirical research design.This part uses the data of listed companies in South Africa as the research sample,defines the variables according to the research hypothesis,then constructs the appropriate empirical model: using the price model to test the value relevance of accounting information,Richardson(2006)investment expectation model to measure the investment efficiency,and the regression analysis model to test the impact of integrated report quality on investment efficiency.The fifth part is empirical analysis,including descriptive statistics,correlation test,regression analysis and robustness test.The last part is research conclusion and policy recommendation.This part elaborates the conclusions of this paper,provides some policy recommendations,and finally pointed out the limitations of this study and the prospect of the future research direction.The conclusions of this paper are as follows:(1)Integrated report quality is positively correlated with the value relevance of the accounting information,higher integrated report quality brings about the greater value relevance of the accounting information;(2)integrated report quality is positively related to the firm's investment efficiency,with insufficient investment and excessive investment both negatively correlated.Based on the view of integrated report quality,this paper researches the impact of integrated reporting on value relevance of accounting information and investment efficiency.It is a supplement to the current research on the economic consequences of integrated reporting.This paper examines the implementation effect of the integrated reporting system in South Africa and provides relevant policy recommendations for the implementation of the integrated reporting system in China,which is conducive to the improvement of information disclosure quality and the improvement of the reporting system.