Managerial Overconfidence,Certified Public Accountants Industry Expertise And Financial Reporting Quality

Significant financial scandal exposure has become common in recent years,the quality of financial reporting has attracted the company's internal management and external investors and regulators' attention.Managerial features can affect the company's financial reporting quality,among them,the degree of rational management is one of the factors affecting the quality of financial reporting.For example,if the managers are overconfident,the management for the future of the risk and income can exist certain deviation,their judgment for the future often leads to the unreasonable decision-making,When the company did not achieve expected profit or to make up for the lower performance,managers will have sufficient motivation for earnings management.That is to say,when managers'overconfidence may prompt them for the earnings management in order to reduce the quality of financial reporting.External supervision is one of the factors affecting the quality of financial reporting.When the accounting firm with expertise in a particular industry,the audit quality tended to be higher than those who don't hire expertise CPAs in the industry.This phenomenon shows that industry expertise CPAs can represent a stronger ability of audit evidence collection,when the company has earnings management behavior,expertise CPAs are likely to find the earnings management behavior.The firm with industry expertise CPAs can restrain earnings management behavior.In addition,the firm with expertise CPAs in the industry can improve the quality of financial reporting.This article is based on earnings management as the breakthrough point of the measure of financial reporting quality,studying the relation between the quality of financial reporting and management overconfidence.On this basis,the certified public accountants industry expertise as regulating variable,measure for the management of overconfidence and the regulation of relationships between financial reporting quality.At the beginning is introduction.This part mainly is talking about the research motivation and meaning,research contents and train of thought and research methods and research contributions,foreshadowing for the later research.The following part is the literature review.It respectively from surplus management,managerial overconfidence,firm and industry expertise and financial reporting quality of these three aspects to carry on the literature review.And then comes the theoretical analysis and the research hypothesis part.This article is talking about the management theory analysis of the relationship between overconfidence and earnings management,and firm industry expertise on the theoretical analysis of the influence of earnings management.The next part is designing the research.In this section I designedvariables andmodel building and do the sample selection for the research.In the fifth part,the article is about the empirical analysis.Based on the fourth part,this part is about management overconfidence and earnings management for multiple regression analysis,and based on the results of multiple regression,join thefirm industry expertise adjustment variables,research firm industry expertise can inhibit earnings management behavior due to managerial overconfidence.The last part is designed for the empirical conclusions and Suggestions.Empirical results through interpretation research conclusions and policy Suggestions are given accordingly,and put forward this paper's research is insufficient and further research direction.