Motivation Study On Financial Report Restatement Of Listed Company In China

Since the last mid-90,Regulatory authorities and academics has paid more attention to financial restatements of listed companies. Through reviewing the existing literatures about the financial restatements, we can find out that the focus spot of current research on this topic is mainly concentrated on the relationship between the corporate governance mechanisms and financial restatements as well as the results by the financial restatements. However, there are few studies nowadays to research the motivation of the financial restatement by listed companies. In this essay, we will anal size the possible motivation of financial restatement, this will not only helps to prevent the occurrence of financial restatement, but also helps to robust the corporate governance and authorities.With a sample of A-share listed companies from 2007 to 2008, this dissertation develops a conceptual model for studying the motivation of financial restatements, as a result, we find out that: (1) Compared to the listed companies which have not financial restatements, the companies announced the restatements have the higher leverages, and lower ROE as well as the TURN. That is to say, the listed companies with more debt and poor performances are more likely to restate the financial reports; (2) the patched companies have more audit committees.The paper is organized into six sections:The first section expatiate the research background and research design,as well as the aim and purpose of this research. Section two introduces the theory used to analyze. Section three analyze the financial restatement thorough correlative theories. Section four & five tested the motivation analyzed using an empirical model. Finally, the section six puts forward some advices according the reality of China and the result of the research.