The Investment Efficiency Of China’s GEM Market

With those 28 listed companies trading on the Growth Enterprise Market since October 30,2009, which marked that the gem in our country has been formally established. The growth enterprise market has become an important financing channel for small and medium-sized enterprises. It also has an important role in promoting employment, reducing the financial risks and promoting industrial innovation. The investment efficiency of these listed companies not only relates to the development of enterprise operating performance, but also affects the vital interests of the investors. However, as those surplus manipulation cases, masses of investors became to query the authenticity and reliability of earnings report. Because of these earnings manipulation behavior caused a study wave of surplus quality. People mainly concentrate in the valuation view, information view and the concept of contract on the quality of the surplus research at the stage. A few scholars are studying the excavation and research in-depth about the quality of surplus. This article bases on the perspective of accounting surplus information, researching the relationship between the growth enterprise market surplus quality and the investment efficiency in our country.On the topic of "surplus quality impact on investment efficiency", the article is based on the principal-agent theory, asymmetric information and the theory of accounting surplus function, to research if the merits of the earnings quality can lead to excessive or insufficient investment. From the perspective of resource allocation, researching whether the efficient allocation of resources can improve the investment efficiency of enterprises. From the perspective of market pricing, researching whether the effective price can restrain agent of earnings manipulation. Through the study to these sample companies, we can find that:High quality surplus can improve enterprise’s investment efficiency. High quality surplus can affect the enterprise operator make the right choice to the project with a positive net worth, which can improve the efficiency of resource allocation and further improve the investment efficiency of enterprises. High quality surplus can also reduce blind investment in enterprises and funding liquidity problems. At the same time, it can improve the investment efficiency of enterprises and promote the healthy growth of the enterprise.This paper is dedicated to solve the problem of the gem company investment efficiency. Take surplus quality as a starting point, to explore characteristics of surplus* accrued project quality and investment efficiency, of action between paths. This article selects 244 listed companies from Chinese gem market as the research sample. Based on defining the earnings quality, investment efficiency to be explained variable, surplus quality as explanatory variables, with free cash flow and asset-liability ratio as control variables to research the growth enterprise market surplus quality impact on investment efficiency in our country. Then we research whether quality surplus can restrain excessive investment to alleviate underinvestment and improve the investment efficiency of the growth enterprise market in China. The study found that the growth enterprise market in China is significantly the efficiency of investment, and the excessive investment phenomenon is more prominent. Enterprise ownership structure does not affect the relationship between earning quality and investment efficiency through the robustness test.In this paper, the main innovations include:Firstly, the paper is based on the perspective of earnings quality, providing one path to resolve the problem of investment difficult for the gem. Due to the current study about the surplus on investment efficiency and the quality of the relationship, mainly from the perspective of property rights, equity structure and explore of system and environment. As few studies are from the angle of accounting surplus, this paper chooses surplus quality as a breakthrough to explore the relationship between investment efficiency and the quality of surplus.Secondly, this paper can enrich the research on earnings quality economic consequences. Currently the research of quality surplus economic consequences is still in its infancy, there is little literature on gem surplus quality was studied. The paper’s mainly job is to study the relationship between earnings quality and investment activity on the gem. I hope can provide new research ideas and empirical results to quality economic consequences of earnings quality through the study.