Research On The Relation Between Institutional Investors Stockholding And The Quality Of The Earnings Forecast Disclosure

With the development of China’s capital market and earning forecast system, more and more investors put their focus on the information disclosure of management earning forecast. As an integral part of the capital market investors, institutional investors pay more attention to the earning forecast information disclosure. Compared with the other investors, institutional investors have some advantages, such as sufficient funds, broad contacts, professional advantages and professional ability of information process, they can supervise and influence the quality of information disclosure of listed companies through "voting by hand" and "voting by feet". The research of institutional investors stockholding’s influence on the quality of the earnings forecast disclosure is rather meaningful, which can not only help other small and medium-sized investors "hitch a ride", providing them a definite direction when they make the decisions of investment, but also promote the improvement of corporate governance, optimize the allocation of resources of the capital market, and promote the effective operation of the capital market.In this paper, we select the disclosure of management earning forecast as the breakthrough point. In order to discuss the correlation between institutional investors stockholdings with the quality of management earning forecast disclosure, based on the studying the related literatures at home and abroad, system background and the theoretical basis, we select a sample of3476listed companies’earnings forecast of main board A shares from Shanghai and Shenzhen Stock Exchange, which ranges from2008to2012, and then choose the data of the end of each year. Based on this background, this paper embarks from three dimensions, which are the precision, the error and the timeliness of earning forecast information disclosure; we put forward6assumptions for each dimension respectively with a total of18assumptions. In our paper, we set the error, the timeliness and the precision of disclosed performance forecast as the variables that to be explained, and define them separately, in the aspect of the institutional investors, we select the institutional investors holding or not, the institutional investors holding ratio, fund holding ratio, holding stability of institutional investors, the number of institutional investors among the top ten shareholders and the holding ratio of the Qualified Foreign Institutional Investors as explanatory variables. At the same time, we also choose several control variables, including company scale, financial risk, related degree between cash flow and operating receipt, market-to-book ratio, earnings volatility and the types of accounting firm, establish a multiple linear regression model to conduct the descriptive statistics analysis, correlation analysis and regression analysis.The analysis results show that,13assumptions among the18assumptions proposed in this paper can be testified. As we can see from the results:generally speaking, institutional investor stockholding have a remarkable influence on the quality of earnings forecast disclosure. Especially, they presented a remarkable correlation less than5%between the fund holding ratio,the top ten shareholders of institutional investors and the precision, the error, the timeliness of earning forecast disclosure, the remarkable correlation are also presented between the holding stability of institutional investors and the timeliness, the error of disclosed performance forecast. Based on the empirical analysis results, in the last chapter of our paper, we put forward some suggestions according to the study result and the current situation of the capital market, At the same time, we carry out more research development according to the existing deficiency, aiming at providing help for the future research development, which can promote a more healthy development of the capital market of our country.