The Study Of The Role Of Media Attention On The Supervision Of Listed Company’s Financial Fraud

While both at home and abroad have spent a lot of energy for the supervision of financial fraud behavior, including raise the level of enterprise governance, formulating the related law and announce the relevant detailed rules and so on, but the effect is not as effective as imagined, financial irregularities are still frequent. Penalty notice issued by the CSRC every year, there are still many companies to be punished because of the accounting information fraud. Seeking outside legal supervision mechanism actively as an useful supplement to enhance the quality of listed companies’ accounting information of is especially important, and in which, the media is an significant part of a macro environment of accounting quality governance, the study of the function and it’s role of media attention on the supervision of the listed company financial fraud behavior are both worth exploring.Firstly, this article study the existing theoretically research, exploring the role of media attention in the improper accounting behavior of listed company supervision system. Then, using Guo Taian listed companies’ illegal information as a database, contrast with the administrative punishment announcement and markets off-limits announcement in 2005-2013, selecting financial irregularities listed companies in Shang Hai and Shen Zhen as samples, at the same time, choosing check sample to form the master samples, on this basis, the way of search the quantity of listed company relevant news from database, constructing index of media attention, establishing a model and collecting data to carry on the empirical analysis. At last, analyzing the role of media attention on the role of supervise the listed company, among them, the inappropriate financial behavior of listed companies was used to measure financial irregularities, on these basis, looking the relationship between media attention and financial irregularities. At the same time, this article also will inspect the influence by the development level of media, political background of the enterprise and the affect of the legal system of macro environment.Empirical research found that there is no correlation between the amount of media attention and the financial irregularities, but there is a significant positive and correlation relationship between negative media attention and financial irregularities, it shows that the more negative media reports, the chance of financial irregularities are greater, media acts a part of information intermediary, it’s helpful to find inappropriate financial behavior. In addition, according to the different political background, there is a different of media attention’s supervision role in the state-owned enterprises and non-state-owned enterprises, among them, under the background of state-owned, the correlation between the negative media attention and financial irregularities are more significant, these is a negative correlation between the development level of media itself and financial irregularity, which suggests that as alternative and complementary of corporate governance law, media can produce deterrent to inappropriate financial behavior, within the legal environment of poor areas, negative media attention plays a strong role in the supervision of financial irregularities.