An Empirical Research On The Relation Between Accounting Information And Investment Price Of Private Equity Funds

In recent years ,Private Equity Funds(referred to as PE) in our country has made a rapid development, it is very meaningful for widening China's investment and financing channels, achieving a breakthrough in China's capital market reforms, promoting the upgrading of industrial structure of China's enterprises and restructuring, and enhancing the value of the invested enterprise. There are lots of Research on the PE theory and practice, this paper attempts to study the process that PE valuate the target enterprises , analysis the relation between accounting numbers and the target enterprises'intrinsic value.The valuation of the target enterprise is affected by many factors , such as industry factors ,enterprise factors , capital market factors and PE management firm factors. In the process of how those factors affect the intrinsic value of the enterprise , the financial analysis play a core part .The contemporary accounting measurement opinion represented by Ohlson refers that accounting numbers can not only deliver information of the enterprise'intrinsic value but directly link to the intrinsic value , and they also can be used as variables into the valuation model . The contemporary accounting measurement opinion laid a theoretical foundation for using accounting numbers to measure the valuation of enterprises and built a former theoretical framework for foundational analysis ,and lots of empirical research had supported the opinionSince current empirical research on Feltham-Ohlson model focused largely on the stock price of listed enterprises ,ignoring the research on the non-listed enterprises , this paper attempts to use the model to study the process of PE valuate the non-listed enterprises .This paper take the prospectuses of SME-listed enterprises and GEM enterprises before October 1 ,2011 as data source , from which selecting the datum related to the investment price of PE and financial numbers of the target enterprises ,meanwhile make four assumptions : 1,PE recognize the enterprises value based on accounting numbers ,the excess earnings and operating assets are highly related with the investment price of PE;2,as to the aspect fitting the investment price of PE , Feltham-Ohlson(1995) model is superior to Ohlson (1995) model , proving that it make sense to divide operation assets ;3,PE emphasis on the entire net income numbers, ignoring the quality of profits ;4,as to different type of enterprises , PE valuate them from different accounting information . The empirical result of this paper adopt all the four assumptions , confirming that relation between accounting numbers and the equity value of non-listed enterprises ,and proving that accounting numbers are useful in PE's investment decision .