The Relationship Between Financial Performance And Corporate Credit Rating Under The Adjustment Of Audit Quality

Since on May 30,2007, the China securities regulatory commission issued 《the pilot measures for company bonds issue》, the corporate bond market in China has gradually active, as of December 31,2014 so far has 379 listed companies issuing corporate bonds.The activity of the corporate bond market can effectively develop a company financing channels, the company through the issuance of bonds in a way that the financing demand will increase.From regulatory hair [2007] no.112 《the pilot measures for company bonds issue》 items specified in the file can be found that the corporation’s financial conditions directly affect the risk of corporate bonds. And the corporation subject A credit rating is the measure of the probability of default, if the corporation want to issue corporate bonds of listed,so companies will have to reach this condition of good credit rating (A grade or above).Under this background, the study which aspects of financial performance to subject the credit rating of corporate bonds will have a significant impact, the credit rating agencies in assessing credit rating of issuance subject will focus on what aspects of the company’s financial performance not only can effectively guide the company to improve from the aspects of its control factors of internal financial management, help its smoothly in the bond market financing, but also can indicates improvement or adjust the direction for the enterprise who in our country to reduce the financing cost of issuance.The article selects 2007 January 1 to December 31,2014 in the city of Shanghai or Shenzhen listed companies issuing corporate bonds as the research sample. The study start with the credit rating related data of corporate bonds as explained variable; Used to measure the performance of the company’s financial bond is earnings quality, firm size, risk and growth,this five dimensions of 34 financial index is selected before bond issue one year’s data. The first step use factor analysis method to dimension of 34 financial indicators to get some comprehensive factors which can explain 80% of the original variable information. the second step use the comprehensive factors as explanatory variables into Ordered Logistics regression model, from the empirical study to find which aspects of financial performance will have a significant impact on the subject credit rating of corporate bonds, and further study whether audit quality has a adjustment on the relationship between those two or not.