Effect Of Accounting Conservatism On The Performance Of Mergers And Acquisitions

Mergers and acquisitions is an important investment decision that enterprise can use it to continuously develop and expand, is a very uncertain and risk behavior. If 2013 and 2014 is called "the Chinese M&A market in the year of". So after the 2015 merger market continues to heat up, transaction amount is increasing. According to Chinese statistics show that the CV Source investment announced mergers and acquisitions market in China in 2015, 9700 cases of M&A events, $709.443 billion deal, quantity and amount for a 24.30% year-on-year growth of 24.30%, respectively, in 2014; Trading conditions to finish with 4156 cases of M&A events, increased by 33.16% compared with 2014, mergers and acquisitions amount to $316.08 billion, rose by 56.37%. This makes mergers and acquisitions of the current hot topic, became a topic of many scholars to study theory. Focus in the study of many researchers in China will also focus on M&A performance, especially on M&A performance influence factor was particularly discussed.Francis and Martin(2010) studied the relationship between conservatism and performance of the company merger and acquisition accounting. Them through the analysis, through the timely confirm the loss to the excessive investment behavior of company management, so that accounting conservatism in the level, the higher the company announced that the market reaction of M&A decision making, the better, after M&A performance of mergers and acquisitions will be higher. This conclusion is for many scholars to explore the influence factors of M&A performance has opened up a new research way. Domestic research of accounting conservatism and performance of the M&A empirical literature is scarce, the only includes three articles in 2015. The author try to according to our country capital market itself characteristic, study the influence of accounting conservatism of M&A performance. On the basis of further analysis, to explore the influence that the relationship between the degree of corporate governance.Based on China's a-share listed companies of 277 M&A events in 2009-2012 as sample, study the effect of accounting conservatism of M&A performance. This paper uses Khan and Watts(2009) design of C-SCORE annual conservatism index model and Givoly and Hayn(2000) proposed the negative accrued model common measure the level of accounting conservatism, the two methods to measure M&A performance accounting index method. Through regression model analysis to get the following conclusion: accounting conservatism, the higher the M&A performance of mergers and acquisitions, the better, the board size and the proportion of independent directors on the relationship between the accounting conservatism and M&A performance effect is not obvious, the institutional investors holding the higher suppresses the robustness of M&A performance. Against this paper get the conclusion, it proposed to improve the conservatism of the company's accounting and governance of listed companies to actively enhance the level of two suggestions.