Empirical Research On The Influence Of The Accounting Transparency For China’s Small And Medium Enterprise Board

The problem of how to improve the accounting transparency is still under intense discussion in both theoretical and practical fields. With the development of China’s the economy, the accounting information is becoming more important to the social and economic resources allocation. The non-transparency of the accounting information will bring uncountable negative influences on our market economy. Especially in these years, minority shareholders’activism due to the deficient transparency of the accounting information misleads the investors and harms their interest. Therefore, it is of great importance to find out the factors which gives rise to the accounting transparency.This paper firstly talks about the background of the topic choosing, final objective, and the research methods. Relevant documents from China and abroad are reviewed as well. Based on the previous work, we further introduce the theoretical structure of the economics with asymmetric information theory, agent theory, incomplete contracting theory and investor protection theory. The reasons of non-transparency are discussed according to the current situations of the medium and small listing companies and their special regulations of information reveal. Further analysis is given focusing on the company’s financial affairs, institutional environment, external monitoring and board characters. Finally, we take the Small and Medium Enterprise Board in Shen Zhen stock market during2005-2010as samples to illustrate our experiment.13explanatory variables are selected in our empirical research and the result of accounting information disclosure quality evaluation released from Shen Zhen stock market is chosen as our explained variable. In order to avoid multi-collinearity and heteroscedasticity due to a large amount of variables, chi-square test is used after the descriptive statistical analysis for more objective and scientific purpose. In addition, we analyse the logistic regression analysis. It can be seen from the results that the company’s financial affairs play a vital role in the accounting transparency of the medium and small listed companies. The independent director system and accounting firms have limited influence on the accounting transparency. The diligence of the board and the government monitoring have nothing to do with the accounting transparency. Finally, the reasons are analysed based on the experiment results and then relevant suggestions are concluded for the medium and small listed companies in order to improve the practical monitoring work in the future.