A Study On Impact Of CFO Turnover On Corporate Financial Risk Prediction

In recent years,the number of executives turnover has gradually increased,and the issue of executive turnover has received increasing attention.The turnover of executives as an important personnel change in the company will often lead to a series of economic consequences.As one of the core of company management,CFO turnover is a major personnel change of the company.The company's strategic adjustments,as well as the financial director's personal self-awareness and consideration of their future development,will be one of the reasons for CFO's turnover.As an important manager of the company's finances,CFO holds important financial information that is not disclosed by listed companies.To a large extent,its turnover may be due to the pre-existing significant financial risks faced by the company in the future,and decide to quit to avoid risks and liability.The new policy adopted by the new CFO itself will also cause the company's financial shocks.Will the turnover of CFO predict the future financial risks of the company? CFO political connections,gender and employment in the company,such as the term of office and holding company shares,will have an impact on the relationship? The study of these issues can expand the research field of the economic consequences of executive turnover,provide favorable information for market investors,and have corresponding theories.The current research on the economic consequences of executive change,especially the economic consequences of CEO's turnover,is relatively rich,and the research on CFO is relatively scarce.It is even rare to study the relationship between CFO turnover and future corporate financial risk.Therefore,in the current situation,the research in this paper has certain practical significance.After clarifying the research direction of this paper.Firstly,this paper combed the relevant literature at home and abroad.Secondly,this paper based on the existing research results,using some theory to propose the research hypothesis.Through the model construction,the hypothesis of this paper is proved empirically.Finally,this paper will draw some conclusions and give some relevant suggestions.Based on the above background,this paper selects the CFO turnover phenomenon of A-share listed companies in 2013-2017 as the research object,and studies the correlation between CFO turnover and corporate financial risk prediction.Through empirical research,it is found that CFO turnover will indicate the future financial risk of the company.In the extended research,this paper further tests the CFO according to whether it has personal characteristics and power characteristics,and divides the personal characteristics into gender and their term in the company,and divides the executive power characteristics into whether they have political connections and whether they hold company shares.The study found that the turnover of the male financial executives compared to female would indicate a higher corporate financial risk;a longer CFO resignation would indicate a higher financial risk;a CFO with no political background will indicate a higher corporate financial risk;the departure of the CFO holding the company's shares will also indicate a higher financial risk.Finally,the paper further analyzes whether companies with higher internal control indexes and better accounting information quality will weaken the relationship between CFO turnover and corporate financial risk prediction.The study found that the higher the internal control index and the better the company's accounting information quality,the lower the financial risk of the CFO's turnover.After a series of robustness tests,the conclusions of this paper are still stable.The contributions of this paper mainly include: Firstly,paying attention to the phenomenon of executive turnover,studying the relationship between CFO turnover and corporate financial risk prediction,and enriching the relevant research in the field of economic consequences of executive separation.Secondly,through the study of CFO's turnover,it will enriched the relevant research on the personnel changes of the financial director of listed companies.