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Research On The Transparency Of Accounting Information

Posted on:2004-09-01Degree:MasterType:Thesis
Country:ChinaCandidate:L R ChenFull Text:PDF
GTID:2156360092491400Subject:Accounting
Abstract/Summary:PDF Full Text Request
Securities market plays a very significant role in allocating resources. Meanwhile, whether it can function effectively depends on the transparency of information, especially accounting information, which the listed companies disclose. If accounting information is false and the transparency is low, it will mislead the decisions of investors, cause the un-effective allocating of the social scarce resources, and endanger the stabilization and development of securities market. At present, securities market in China is on its childhood, so it is flooded with false accounting information and low transparency. To improve the efficiency of allocating market resources and decrease transaction cost, the disclosure of accounting information should be standard and transparent. So the writer makes research on the issue of transparency of accounting information with the expectation of providing some advice on improving transparency of accounting information in Chinese listed companies.This dissertation is composed of four chapters:Chapter 1 describes some basic theories about the transparency of accounting information. The chapter consists of three parts: Part 1 analyses the conception of the transparency of accounting information and its economic meanings according to effective securities market suppose, agency theory and accounting information objective. Part 2 defines quality characters of accounting information, including the main quality characters, sub-main quality characters, etc. Part 3 puts forward the issue about the measurement of accounting information disclosure. It's impossible to provide accounting information fully because of the barrier of present technology level and cost-income principle. So it is necessary to measure the disclosing degree of accounting information to maximize the benefit of the related parties (that is Pareto optimum).In chapter 2, the present situation and the reasons of the transparency are explained .The chapter is also divided into three parts. In part 1, the author discusses the harm of low transparency including high capital cost, ineffective allocation of scarce resources and negative effect on absorbing foreign capital. The present situation of transparency in China is mentioned in Part 2. Some questions such as punctuality,contents and means of accounting information disclosure are pointed out. Part 3 sees the reasons from both in and out of companies, including inner ones like weak accounting basic work, the negative affect from breaking the listed companies, unreasonable corporate governance; and outer reasons such as the limitation of accounting standards and systems, the lack of minority stockholders supervision, the loss of external auditing independence and imperfect related laws.In Chapter 3, the research on how to improve the transparency in the West is introduced and enlightenments on us are as follows: to improve the transparency, not only high quality accounting standards are wanted, corresponding support infrastructure is also needed. These support infrastructure should include the followings: high quality auditing standard, competitive and especially educated administrative human resources, the cultural requirements and atmosphere for high quality financial reports and the humane spirit on honesty popular in the business world.In chapter 4, some practical advices are suggested: (1) strengthening accounting basic work, improving accountants' quality and training them in further education especially in sincerity education;(2) perfecting concerning laws and standards to minimize the profit-manipulating room and increase the cost of false accounting information; (3) perfecting corporate governance, that is: setting up reasonable stock right structure, bettering the corporate spurring system and carrying out independent director policy thoroughly and peacefully; (4)strengthening external auditing independence and improving auditors' work quality.
Keywords/Search Tags:Accounting information, Transparency, Accounting standard, Independent director, Corporate governance
PDF Full Text Request
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