| Stock split risk is the probability that a stock price or market index will suddenly fall sharply without any sign of information.Generally,stock prices are more likely to collapse and have less inflation,i.e.,the returns on the stock market are asymmetric(Bekaert,and,Wu,2000,Black,1976,Wu,2001).While China's stock market is booming,there are also many problems,among which the problem of stock price inflation and collapse frequently occurs(Xiao Bin,2010).The collapse of the stock price will destroy the personal wealth of investors,impact the healthy operation of the capital market,and even affect the development of the national economy.Therefore,it is of great significance to study the risk of stock price collapse in China's capital market,how to guard against the risk of stock price collapse,and to enrich the research framework of stock price collapse risk,and to promote the healthy development of China's capital market.In recent years,based on the principal-agent theory,scholars have put forward the theory of bad news hiding.The theory that the management of the company's information disclosure has the right to choose the management compensation contracts,etc.based on the occupation career motivation,often choose not to disclose bad information,so it has the advantage of information to expand the degree of information asymmetry and small investors.With the sustained business cycle,bad company information will continue to accumulate,the stock bubble occurs,but the company may not be permanent hiding bad news,once the accumulation of bad news more than the company's holding limit,will focus on the release of bad information to the market,resulting in the company stock bubble burst,stock prices continued to decline,the stock price induced crash.But the literature is more factors of accounting earnings transparency and other firm characteristics based on risk analysis of induced collapse in stock prices,have little effect on stock price transparency literature on cash flow risk of collapse,and this is the opportunity.Cash flow information is paid more and more attention by investors.Since 1998,China's listed companies began to disclose the cash flow statement,and has more space to manipulate accounting earnings,cash flow is considered as more reliable information than accounting earnings,the company is a real cash inflow and outflow,with less space to manipulate,so the cash flow information is more important than earnings information to investors more(Cheng et al.,1996).Taking into account the important impact of cash flow information on investment decisions,the company has a strong incentive to manipulate cash flow(Zhou Donghua and Zhao Yujie,2014).Zhang Guoqing(2007)believes that China's cash flow statement standards promulgated one of the objectives is conducive to the users of financial statements to forecast the cash flow,cash flow and earnings as if being controlled,will affect investors' investment decisions,market resource allocation problems will appear wrong.Further,Zhang Ran(2007)broke the "cash is king","cash flow manipulation",as the company manipulated earnings report,the company's management also manipulated the enterprise operating cash flow report.Earnings manipulation significantly reduces the transparency of earnings information,which affects the transparency of financial reporting,cash flow manipulation will affect the transparency of financial reporting,because of reduced cash flow information transparency(Lee,2012).Then,cash flow manipulation caused by opaque cash flow information will increase the risk of collapse in stock prices? This article will explore this.Further,research has been less concerned about the stock crash risk governance mechanism,taking into account the institutional investors and high quality audit is considered effective external corporate governance mechanism,so whether institutional investors and high quality audit can effectively play the role of external corporate governance,namely by curbing the listed company's cash flow manipulation.To improve the transparency of cash flow information,thereby reducing the risk of listed company's share price collapse?There are six parts in this article.The first part is introduction.This section analyzes the background and significance of the study of the relationship between cash flow manipulation and the risk of stock price collapse in listed companies,and designs the framework of this paper.Finally,the contribution and shortcomings of this paper are briefly summarized.Then,the second part is literature review.Through reviewing and summarizing the literature of two aspects of cash flow manipulation and the risk of stock price collapse,we deeply understand the specific research results of relevant issues,and pave the way for the next empirical study.The third part is mainly related to the theoretical overview.On the one hand,through the summary of related literatures,the definition of transparency,and the concept of cash flow manipulation of stock crash risk,on the other hand,the basic theory of this paper is summarized,including the principal-agent theory and information asymmetry theory,relationship and flow control on cash and stock price crash risk theoretically.The research hypothesis is the main content of the fourth part.The intrinsic connection between control flow behavior and stock price crash risk in cash after carding,puts forward the hypothesis 1: after controlling for other factors,the company's cash flow control degree is higher,the greater the likelihood of the stock crash.On this basis,considering the influence of institutional investors and high quality audit flow manipulation and stock price crash risk on cash,respectively put forward hypothesis 2: institutional investors to curb the cash flow positive relationship between stock price manipulation and the risk of collapse and hypothesis 3: high quality audit to curb the positive correlation between cash flow the stock price manipulation and crash risk.After putting forward the three hypotheses of this paper,the fifth part takes the non-financial listed companies in China's capital market from 2002 to 2012 as the research sample,and empirically tests the relationship between cash flow manipulation and the risk of stock price collapse.The cash flow manipulation and stock crash risk is positively related,indicating that the listed company's cash flow manipulation will lead to the possibility of the occurrence of collapse in stock prices rise,because it increases the company information opacity.Further study found that institutional investors and high quality auditing played a better role in corporate governance,to effectively curb the listed company's cash flow manipulation,thereby reducing the positive correlation between stock price manipulation and cash flow risk of collapse.The sixth part summarizes the research conclusion and puts forward relevant suggestions to reduce the stock crash,in addition,the study found that the problems and disadvantages are briefly described in this paper and put forward the future direction of the research on several points. |
PDF Full Text Request