Based On The Research Of The Listed Company Financial Restatements Announcement And Explanation

In recent years, the Financial Restatements phenomenon is more and more frequent in China. This caused the investor’s attention.In addition; academia and regulators also given the high attention. This paper selected samples contain306listed companies, which released the Financial Statement Restatements Announcements in2005to2009, as research objects. Used normative and empirical research methods to research China’s listed companies’Financial Restatement behavior further.Firstly, this paper researched the current situation of the Financial Restatement. From the perspective of time distribution of Financial Restatement Announcement, before the new accounting guidelines issued, the total company’s number that accrued the Financial Restatement behavior was more than after the new guidelines carrying out. Moreover, those Restatement Announcements focused in March and April to be issued. The proportion was as much as68.63%. From the perspective of industry and regional distribution of Financial Restatement Announcement, our country’Financial Restatement existed universality. Industry distribution was balanced. In general, in each Industry, the proportion focused on3%-5%. The regional distribution existed non-equilibrium phenomenon. In comparison, the proportion of the listed company in the economic developed area happened the Financial Restatement was smaller than the less developed areas.Secondly, we read and tide the306financial restated announcements carefully. All samples were divided into the passive and active classes to test the market effect of Financial Restatement Announcement. The results showed that the average abnormal returns of active and passive samples were significant negative, respectively-0.9874%and-1.4541%. This point showed that investors believed the occurrence of Financial Restatement represents a bad news.At the base of effect test, this paper constructed multiple linear regression models to explore the specific factors which effect the significant fluctuations of sample company stock price. Empirical study found that points:(1) in this model of passive samples, the sample company’ debt paying ability and stock cumulative abnormal returns were significantly positive correlative at the level of5%. The future development ability and stock cumulative abnormal returns were significant negative correlation at the level of5%. At the significant level of1%, the year of Financial Restatement and the ability of cash flow exert positive influence to stock cumulative abnormal returns, but shareholders’profitability size and the stock cumulative abnormal returns were significant negative correlation. Our state’s policies and regulations have alleviated produce market effect of the financial restatement. And the occurrence of financial behavior makes the relevant interests doubt the company’s financial information. When decision-making, investors should conside these factors as key factors.(2) In this model of active samples, only one factor that shareholders profitability size through the significant inspection at the level of5%, and this factor had negative influence to the sample stock cumulative abnormal returns.Finally, the author did an in-depth analysis about the above results. And on this basis, put forward some suggestions to the listed company, investors and regulators respectively about Financial Restatement problem. At the same time, the deficiency of this research and the subsequent research direction were explained simply.