Institutional Environment,Political Connection And The Quality Of Accounting Information

At present, Chinese system is not perfect in the background. Political connection plays a very important role in the private company, as between the company and government contract. Government officials and its related company can benefit according to the invisible contract. The macroeconomic resources allocation model and microeconomic strategy planning are subject to political connection influence. Political connection which generally comes from companies or major shareholders of the politically connected company at the top will involve the serious agency problem. The quality of accounting information disclosure will be inevitably affected by this model--Corporate political connection dependent stealth contracts "relational" transaction mode. Privately acquired information can promote the development of competitive advantage more than public information in this environment. The company will be able to obtain the information and resources which competitors could not have, companies can profit from "hand" of government support.According to the research, academic circles on the quality of accounting information in the political connection have two different points of view:(1) The government supervision and the accounting control make the politically connected company providing high quality information in certain circumstances;(2) Business stakeholders and accounting information providers do not pay attention to the quality of information disclosure. The major shareholder of the company in order to cover the act which it seek other stakeholder interests, it will provide low quality accounting information.The latest research of institutional economics found that institutional environment will interfere with political connection. Chinese private companies have almost identical economic development capacity. The geographical area, the company resources, the national policy is different, institutional environment is different in different places. The study found that, politically connected company can hide under the umbrella of the government, as far as possible to reduce the adverse effects from the government where the institutional environment is poor.So far, scholars at home and abroad have normative and empirical research on the relationship between political connection and the quality of accounting information. In the aspect of academic value, the research on the relationship among the system environment, political connection and the quality of accounting information is a small number. The existing literature has not been systematically explored the relationship among the three.The relationship among the market, government and company is the core problem in the reform process of the economic system. Political connection exists widely in the world market. Because political connection can get more political resources. The more abundant resources are allocated, the political related company obtains more core advantage in the market competition, grasps more technology and manpower, has better prospects for development. Companies are keen to establish political connection. Since the political connection affect the behavior of companys. How does it affect the company accounting information disclosure? This is a question discuss in the article.According to the related existing studies in literature. In the transition economy background, as a property protection substitution mechanism, the political connection will significantly reduce the quality of accounting information. Listed Company who establish the political connection is most likely to avoid punishment or weaken the strength of punishment by means of political connection. In area where the legal level is low, the speed of market process is slow, effect is more outstanding. Therefore, study on how the regional institutional environment, corporate political connection affect the quality of accounting information is also a problem discuss in the article.The research analyzes the potential relationship among the political connection, institutional environment and accounting information quality. Select the data of Shanghai and Shenzhen A shares of private listed Company 2009-2013, a total of 1268 samples. The data of political connection is collected by hand. Through the empirical analysis of the correlation that political connection and the quality of accounting information, the analysis join cross terms of the system environment(market analysis index factor) and the political connection. Study how system environment affect the relationship between political connection and the quality of accounting information, then combine theoretical analysis with empirical research methods to analysis.