The Effect Of Background Of Independent Directors On The Accounting Information Quality

Background of independent directors is the first item to decide "what kind of independent directors could effectively take the regulatory responsibilities given by China Securities Regulatory Commission(CSRC)". The question must be answered in the independent director system, and even corporate governance system. However, the CSRC and listed companies have different requirements of independent directors. It is vital whether independent directors could achieve qualified achievement on the original intention of establishing an independent director system. This paper studies on this issue in-depth analysis, and make research on the effect of background of independent directors on accounting information quality.This study uses 2005-2007 circulation listed companies as samples,and makes multiple linear regression to test the relationships between independent directors and accounting information quality on the base of three kinds of background variables of independent directors. We find that the financial background of the independent directors play a significant positive role in raising the quality of accounting information.Legal background also play a positive role in enhancing the quality of accounting information,but less than that of the financial background.Those independent indirectors with relevant business background can not raise the quality of accounting information.This paper shows that the Securities Commission's expectation of the independent directors on regulating the quality of accounting information is largely different from the actual needs of listed corporations.Therefore, the proposal is put to shorten the gaps between the listed companies and the Commission. The regulatory side should pay attention to the quality of accounting information evaluation, and guide listed companies to focus on the quality of accounting information and to increase the proportion of financial and accounting independent directors.The enterprise should make a distinction between the relevent technical and financial and legal people.Those consultants positions should invit the technical, financial, legal persons, however, inviting indepent directors ought to focus on improving the quality of accounting information, so that it is recommended to invite the financial, legal persons and increase the proportion of financial independent directors in order to enhance the quality of accounting information.