Study On The Relationship Between The Key Executives Accounting Professional Background And Debt Financing

Debt financing is the main means of financing a modern enterprise, but this is alsoa risk for enterprises. In the middle of last century, Professor Simon, boundedrationality theory is proposed, the relaxation of the hypothesis of rational economicman, manager behavior on corporate debt financing decisions of a domestic andinternational scholars to study and explore the area.This will affect one of the factorsof rational decision making managers---professional background as a study object,study manager with the accounting professional background when making debtfinancing decisions in relation to other professional background is more robust.Theory describes the background of the executives with accounting careerdecision-making of the robustness of the reasons that, if an executive careerbackground is in accounting, the accounting principle of prudence that may affect theexecutive behavior, attitudes, and risk preferences.In this paper, we build the regression mode in debt levels and debt maturitystructure of two perspective from the1996-2009Chinese listed companies for theraw data samples, stricting control of the factors that affect debt financing, l, thecorrelation test and multiple regression analysis and using the same scale in the sameindustry matched sample T test, we use the empirical studies of the management toaccount profession background on corporate debt financing behavior. Finally draw thefollowing conclusions: first, executives professional background in accounting andcorporate stability is correlated to debt levels negatively, but not very significant,indicating that over-investment in our common behavior; second, senior occupationalbackground in the robustness of accounting is correlated to corporate short-term debtmaturity significantly negative behavior, compared to short-term liabilities,professional background is accounting executives prefer long-term liabilities, whichliabilities, long-term side; third, senior professional background is accountingconservatism andcurrent ratio, quick ratio was significantly positively related to debtmaturity structure and maturity matching of assets.This enriches the research results of the impact of manager behavior on corporatedecision-making and has some theoretical significance.Moreover, according tofindings of the study and enlightenment, the paper puts forward some policyrecommendations for the financial management practices.First, to construct themanager’s learning mechanism. Second, to establish a scientific and rationalevaluation system of debt financing decision.third, to establish and improve to the remuneration of management incentives; Fourth, it improve the corporate governancestructure; Fifth, improve the external market governance mechanisms. Construction ofthe learning mechanism of the first managers; Second, to establish a scientific andrational evaluation system of debt financing decision; Third, establish and improvethe remuneration of management incentives; Fourth, improve the corporategovernance structure; Fifth, improve the external market governance echanism.According to the proposal above, the paper hopes the practice in the managementof companies to establish an effective mechanism to promote continuousimprovement of management level,and to maximize the limited rationality toreduce the impact of corporate finance and too promote the efficient operation ofenterprises and also improve corporate value.