The Research On The Impact Of International Convergence Of Accounting Standards On The Efficiency Of Capital Markets

Since 2001,under the impetus of the International Accounting Standards Board(IASB),countries around the world have abandoned their trditional GAAP and adopted International Financial Reporting Standards(IFRS).According to IASB 's official website,as of June 2018,144 countries(regions)have required all or most listed companies to adopt IFRS,involving more than 27,000 listed companies on 88 major stock exchanges around the world.Countries(regions)that enforce IFRS have a combined GDP of 35 trillion US dollars,accounting for 46% of the global total.The proponents of IFRS believe that the global implementation of uniform accounting standards can promote the comparability of accounting information between different countries,improve the transparency of financi al reports in various countries,and thus reduce the conversion costs of accounting information and reduce information asymmetry.This increases transparency,accountability,and efficiency in global capital markets.So,with the increasing of internationa l convergence of accounting standards,can the efficiency of capital markets be improved? This is a problem that needs empirical research and is also the main content of this paper.However,we need to have a clear understanding of the meaning of capital m arkte efficiency firstly.By reviewing and combing the relevant theories,we call the efficiency of the price discovery mechanism of capital market information efficiency,and the efficiency of the price transmission mechanism allocation efficiency.The allocation efficiency is divided into two levels.First,after the price discovery,how the capital market allocates funds to the best companies,we call it macro-allocation efficiency.Second,how to use the funds to creat maximum value after the enterprise obtains it,we call it micro-allocation efficiency.We can form a complete understanding of capital market efficiency only by combining information and allocation efficiency.According to the adaptive market hypothesis,the capital market efficiency is affected by various factors and has been in the process of development and change.Accounting information is one of the important factors that affect the efficiency of capital market.The change of accounting standards has a certain influence on the accounting information more or less,and may affect the efficiency of the capital market.We have conducted empirical research on this and found that:First,this paper takes 14366 annual financial reports from 1582 listed companies in 13 countries from 2006 to 2015 as a sample,and makes an empirical study on the impact of international convergence of accounting standards on the micro-allocation efficiency of capital market.It is found that the convergence of accounting standards promotes the efficiency of capital allocation of listed companies,and the quality of accounting earnings and the international comparability of accounting information have intermediary effect.Among the sub-samples of common law countries,the quality of accounting earnings has a complet e intermediary effect,but the intermediary effect of international comparability of accounting information is not significant.In the sub-samples of civil law countries,both the quality of accounting earnings and thecomparability of accounting informatio n has partial intermediary effect.Second,taking 13 countries around the world from 2006 to 2015 as a sample,this paper studies the impact of the mandatory adoption of IFRS on the macro-allocation efficiency of capital markets and the path of its impact.The study found that the mandatory adoption of IFRS by countries around the world has an effect on the efficiency of capital market macro-allocation,while the quality of accounting surplus and the international comparability of accounting information at national level have a partial intermediary effect.Third,this paper examines the impact of mandatory IFRS adoption on the information efficiency of capital market.The stdy found that the mandatory IFRS adoption has promoted the improvement of the quality of accounting surplus at the national level,and thus improved the information efficiency of capital market.However,we only found significant mediations in sub-samples of common law countries,but no similar evidence was found in sub-samples of civil law countries.That is to say,the international convergence of accounting standards plays a different role in countries with different legal systems.To further study the impact,we designed the 2005 EU enforcement of IFRS as a quasi-natural experiment.Through the DID analysis method based on panel data,we study the impact of this exogenous event on the efficiency of capital markets.And we found that the mandatory IFRS adoption of EU has little effect on the static linear index Q-value,but for BDS and RARE,which reflects the comprehensive predictability of the capital market,the mandatory IFRS adoption shows a certain promotion.The robustness test further shows that it is not due to the special reasons of the EU,any other country or region that consis tent understanding and implementation IFRS is likely to promote the quality of accounting information,to alleviate the information asymmetry,to enchance the transparency of the company,thus improving the efficiency of the capital market.These findings show that:(1)The impact of international convergence of accounting standards on the different aspects of efficiency of capital market is different.(2)The effect of international convergence of accounting standards on the efficiency of capital market is constrained and affeed by many factors,especially the country's legal sources.(3)The impact of international convergence of accounting standards on accounting information have some deeper impact,but the current research rarely pay attention to.This p aper finds that accounting information has some intermediary effect on the impact of international convergence of accounting standards on efficiency of capital market.Compared with the existing literature,the possible innovations in this paper are:Firstly,this paper deeply studies the impact of international convergence of accounting standards on the efficiency of capital market.The efficiency of capital market is the core problem of financial theory,and the basic function of accounting information to the efficiency of capital market has been deeply expounded.From the new perspective of international convergence of accounting standards,this paper studies the promotion of accounting inforation on capital market efficiency.From allocative efficiency to information efficiency,from micro-corporatre level to macro-national level,this paper finds that the convergence of criteria has certain impact on the efficiency of the efficiency of the world's major capital markets.This is not only the innovation of the capital market efficiency theory,but also the enrichment of the literature on the economic consequences of the convergence of standards.Secondly,this paper studies the way of the impact of international convergence of accounting standards on the e fficiency of capital market.Accounting standard is a system that regulates the content and manner of accounting information disclosure of companies.Its changes will more or less directly affect the quality of accounting information,and when the accounting information of all companies is improved,the change of micro-enterprises have some macro meaning.According to the existing research literature,this paper selects the quality of accounting surplus and the comparability of accounting information as int ermediary variables,and studies the path of the impact.We find that to some extent the international convergence of standards has improved the quality of accounting surpluses and the international comparability of accounting information,thus promoting t he efficiency of capital markets.Thirdly,in the course of research,this paper improves the measurement method of the comparability of accounting information,puts forward the concept of international comparability of accounting information,and expands the research perspective.Compared with the previous method,the advantage of this method is that the macro-level comparability is based on the micro-level comparability calculation,so it is more reliable.The international convergence of accounting stand ards is an important event in the history of accounting development.Its Its economic consequences may not be fully reflected up to now.Therefore,it is worth our continuous and profound exploration and research.