A Study On The Infection Effect Of Asset Impairment Announcement Of Listed Companies

The capital market and China’s economy keep pace with the development,but the current relevant information indicates that there is a capital market of frequent violations of information disclosure of listed companies,the use of accounting titles for surplus manipulation and other incidents so far.Among the accounting titles manipulated by listed companies,asset impairment is one of the most commonly used ways.Owing to the development level of China’s capital market,the role of the stock market is not fully play,and it’s clear that there exists the information imbalance between listed companies and investors.When investors find the asset impairment business of listed companies,they can’t reasonably judge whether the reason behind them is the real impairment of assets or the management is in surplus manipulation,hence they will reduce the profit and operating expectations of listed companies,which will cause the decline in the stock price of themselves.This effect may even spread in the capital market,thus leading to the existence of the infection effect of a listed company’s asset impairment business between industries or even in the whole market.Therefore,exploring how the asset impairment business affects the value of the company,and whether this infection effect exists in the market,is an important issue closely related to the participants of the whole capital market.This paper firstly sorts out the relevant researches of asset impairment and announcement infection effect of domestic and foreign scholars,and analyzes the mechanism of asset impairment business infection effect of listed companies based on the accounting information quality requirements and the effective market hypothesis.Subsequently,the theoretical hypothesis of the infection effect of the asset impairment business of listed companies was established,and a-share listed companies from 2010 to 2020 were selected to empirically test the infection effect of the asset impairment business.Through empirical analysis,this paper draws the following main conclusions:first,the disclosure of material asset impairment information will not only cause the decline of its own stock price,but also affect the stock price of other enterprises with the same business in the industry.At the same time,the cumulative abnormal return rate of the enterprise will be less than zero;second,there is a positive correlation between the stock price of other enterprises operating the same business in the same industry and the loss of asset impairment of the event company.In addition,if there are more cases of asset impairment of the same event,the stock price of other enterprises in the same industry will fall sharply;third,the asset-liability ratio will cause the enhanced infection effect of asset impairment,while the company size,profitability and nature of the company not mentioned impairment will weaken the infection effect of major asset impairment.Finally,this paper makes feasible suggestions from the perspective of regulatory authorities,listed companies and investors,simultaneously,proposes the research prospects based on the data results obtained from the study.The research results of this paper provide the empirical test of the asset impairment effect of listed companies in the capital market,and it’s expected that the research conclusions and policy suggestions can optimize the investment decision of the capital market participants,enhance the regulatory level and promote the healthy progress of the capital market.