An Empirical Study On The Influence Of Accounting Information Quality On Financing Constraints

With the development of Chinese capital market, the listed companies’ stakeholders are increasing, as the most important way to understand the company’s financial position, operating results and cash flows, the accounting information is paid much attention by stakeholders. Accounting information quality is mainly composed of "accounting information" and "quality", the accounting information quality is the sum of accounting information provided by an enterprise to meet the needs of the information users, the higher the sum, the better the quality of accounting information. In recent years, the financial fraud companies continue to be broke, stakeholders become carefully analyze accounting information, instead of blindly believing the data of the accounting statement provided by the listed company, through the analysis of accounting information, investors of enterprise have their understanding of accounting information quality, in order to reduce risk, they tend to favor companies with high quality of accounting information. To compensate investment risk brought by low accounting information quality, company investors usually demand a higher return for this kind of companies, the cost of capital increase and financing constraints are more serious.Due to relatively underdeveloped financial markets in developing countries, financing constraints is a widespread problem, together with the impact of information asymmetry and transaction cost, external financing costs are high and hard to obtain. If the enterprise has investment projects which net present value is greater than zero,but has no sufficient funds for the investment, eventually give up, this is bad for the promotion of enterprise’ value, reduce the allocative efficiency of the capital market, and it’s not helpful for the development of the capital market. On the one hand, through the evaluation and judgment of the accounting information, investors choose company which has a good prospects for development to invest, on the other hand, companies want to get enough money to invest in projects of net present value greater than zero, there must be a meeting point between them. Theoretically, based on signaling theory, the enterprise which has good investment opportunities is willing to provide high quality accounting information, in order to reduce the degree of information asymmetry and pass a good signal. Investor boost confidence in the high quality accounting information enterprises, investment demand for that type of enterprises increase in the capital markets, then the cost of capital will be reduced, and ease financing constraints problem. The way for accounting information quality affect the financing constraints is the cost of capital, therefore, study on influence of accounting information quality on financing constraints is valuable.According to research conclusions, this paper puts forward the following suggestions:First, for the enterprise, attach importance to the improvement of accounting information quality, and make it conscious action of the enterprise to strengthen the quality of accounting information. For investors, financial institutions and other funds providers should contact loan or other investment with information quality in credit activities and investment activities, it’s not only reduce the risk of their own, but also raise enthusiasm of enterprises to improve the quality of accounting information. Second, strengthen corporate governance, give play to the role of independent directors, the improvement of corporate governance will convey a good market operation signal and reduce the degree of information asymmetry, at the same time, the enterprise can establish internal control system, perfect the internal audit to promote enterprise’ healthy economy running. Third, pay attention to the application of internal capital market, the enterprise can be moderately expand the scale of assets to form scale effect, establish internal capital markets, expand the source of funds, reduce the cost of capital and risk of financing constraints, satisfy the enterprise’ fund needs in a timely manner. Fourth, weaken government intervention caused by difference of the nature of property, improve efficiency of financial market. The financing problem of state-owned enterprises accumulate risk to the financial markets, and it’s harmful to the long-term and stable development of the market. Reduce government intervention is helpful to promote the development of fair market. Fifth, perfect supervision law, strengthen substantive supervision. Through unceasingly perfect regulation law, guide enterprises to continuously improve the quality of accounting information, strengthen the market discipline of enterprise, severely punish enterprises which provide false and misleading information, and promote the healthy development of the financial market.The contribution of this study is mainly reflected in the following aspects:First, based on the verification of a negative correlation between the quality of accounting information and the financing constraints, creatively put forward the influence of other factors on the relationship, including the proportion of independent director, the group operation as well as the nature of property rights, provide a new perspective for the study on the relationship between the quality of accounting information and financial constraints and enrich the research contents.Second, this paper provides theoretic approaches for enterprises to ease the financing constraints. By studying the different performance in the relationship between accounting information quality and financing constraints in different conditions, verify factors which may affect financing constraints, and provide more choices for enterprises to ease financing constraints.Third, in the measurement mode, the quality of accounting information not only use information disclosure ratings in the Shenzhen Stock Exchange to measure, but also apply earnings quality calculated by the modified Jones model to measure the quality of accounting information, and sample size becomes larger. Existing research mainly adopts information disclosure rating results in the Shenzhen Stock Exchange as the proxy variable of accounting information quality, and the sample size is limited to listed companies in the Shenzhen Stock Exchange. This article adopts the corresponding data of all A-share listed companies to quantify the quality of accounting information, use information disclosure rating in robustness test part, and make the research conclusion more persuasive.Fourth, this paper uses the latest data from2008to2012, samples includes all A-share listed companies, so there is more valuable reference on the relationship between the quality of accounting information and financial constraints.Because of the limited knowledge and ability, this paper has the following disadvantages:First, in the robustness test section, sample size reduced. In the robustness test part, the quality of accounting information is measured by the information disclosure rating, since the evaluation is only for the Shenzhen Stock Exchange listed companies, robustness test only use the Shenzhen Stock Exchange listed companies, the sample size has been reduced.Second, there are many ways to measure accounting information quality and financial constraints, due to the limitation of time and energy, on the basis of existing research on this topic, this paper chooses the modified Jones model to quantify the quality of accounting information which is widely adopted, use the cash-cash flow sensitivity model to measure financial constraints, without considering other models.Third, there are many factors which can influence the quality of the accounting information and financing constraints, this paper considers only one part, such as the independent director ratio, group operation and property rights. Conclusion remains to be deepen.