A Positive Research On The Quality Of Accounting Information, Captial Allocation Efficiency And Market Value Of Listed Compancies

The Third Plenary Meeting of The18th Central Committee pointed out that the market play a decisive role in the allocation of resources. Accounting information is an important basis for investors, creditors and other stakeholders in decision making, and it can lead to the rational allocation and the orderly flow of economic resources. It has important theoretical and practice meaning to have a positive research on the quality of accounting information, capital allocation efficiency and market value of listed companies.The asymmetric information and agency problems will lead to the non-efficiency investment of enterprises, resulting in the waste of capital and the loss of enterprise’s market value. The relationship between the quality of accounting information and capital allocation efficiency performance in:(1) the quality of accounting information can alleviate the problem of information asymmetry, thus reducing the adverse selection and reduce financing cost to reduce the underinvestment and improve the efficiency of capital allocation;(2) the quality of accounting information can reduce the agency problem, regulate the project selection and control overinvestment or underinvestment, thus improving the efficiency of capital allocation. The relationship between the quality of accounting information and the enterprise’s market value performance in:(1) the quality of accounting information affect the company’s investment decisions, thereby affecting the value of enterprises;(2) the quality of accounting information can reduce the cost of corporate financing, so as to improve the enterprise value;(3) the quality of accounting information can change the corporate governance structure, so as to improve the enterprise value.This paper selects the listed companies of Shenzhen stock exchange in2007-2012as the sample data to study the relationship between the quality of accounting information, capital allocation efficiency and the market valuation. Two methods are used to measure the quality of accounting information:one is the manipulation of accrued profits, represented by the residual value of Jones model. The greater the residual value, the greater the discretionary accruals, the lower the quality of accounting information. The other one is accounting information evaluation level of the listed companies disclosured by Shenzhen stock exchange. The evaluation results are divided into "excellent, good, pass, fail", and1,2,3,4are assigned to it respectively. The efficiency of capital allocation can be measured by the non-efficiency investment model proposed by Richardson and represented by the residual value of Richardson model. The greater the residual value, the smaller the capital allocation efficiency. Market value is represented respectively by Tobin Q and closing price of the end of the year. The measurement indicators of the quality of accounting information should be as small as possible, so taking the reciprocal value the of the Tobin Q and the closing price of the end of the year.The empirical study found that:the quality of accounting information in listed companies have a positive correlation with the capital allocation efficiency; the rate of return on common stockholders’ equity and the agency cost have a positive correlation with the capital allocation efficiency; the average level of the accounting information disclosure of our listed companies get a pass grade, but may not be a good; the quality of accounting information have a positive correlation with the market value of listed companies.Based on the empirical research, this thesis put forward the following suggestions:First of all, the listed company should restructured the internal structure and internal control system to reduce the asymmetry of accounting information. Secondly, the supervision department should improve the laws and regulations and impose heavier punishment to increase the default cost of accounting information disclosure. Thirdly, investors should incite the institutional investors to join the decision-making process of the listed company’s governance and information disclose. Finally, proper intervention by the government to the companies can lead capital to the industry and enterprise with high investment efficiency.