China's Listed Companies Usefulness Of Segment Reporting

In recent years, there has been a continuing trend toward public listed companies to operate multi-industry and multi-region, with the integration of world economy, and enterprises' competence getting more and more tough. That makes it urgent for us to conform segmental reporting to the standard. This paper demonstrates the usefulness of the segmental information through normative and positive research.Firstly, I sort out the documents on segmental reporting in our country, then point out the reasons why I chose this topic and the academic and practical significance of this paper. In the second part, I expound the circumstances under which segmental reporting appear and emphasize that decision usefulness makes segmental reporting necessary. Then I identify the major uses and meaning for our country to disclosure segment information from three aspects. In the third part, I introduce the regulations of other countries on segmental reporting briefly. After that I divided the regulations on segment information in our country into five periods, and the current achievements on segment reporting.The important parts of this paper is the positive research on segment reporting usefulness and the investigation on segmental reporting disclosed by our public listed companies. I introduced the research achievements on positive research of scholar abroad. Correlation measures are the computed between the betas and the covariance ratios. Results showed that for line of business reporters, the association between betas and covariance ratios are significant at 5% level. Then I concluded that segment earnings on a line of business basis have information content, which can be used to predict market determined risk. Through investigating 126 public listed companies according to investigation paper designed by myself, I know about the characteristic of segment information disclosed by our public listed companies in annual statement. At the same time, I analyze the reasons that form this situation of the disclosure of segmental reporting.At last, I rise some suggestions to perfect the standard in accordance with the problems of disclosure of segmental reporting.