The Impact Of Environmental Rules In CAS On Enterprise Value

CAS refers to the Chinese Accounting Standard for Business Enterprises.This study analyzes how the implementation of the environmental rules in CAS makes some differences to enterprise value based on the background of the change of CAS in 2006,using theoretical analysis and empirical analysis.Firstly,this paper analyses total effect of environmental rules in CAS on enterprise value using Pigouvian theory and economic consequences theory,and the individual effect of environmental rules in CAS on enterprise value through investment activities,financing activities,operating activities and revenue distribution activities.Secondly,the above results have been tested in mediating model and structural equation model.The results show that the implementation of environmental rules in CAS has a positive effect on enterprise value overall.Furtherly,environmental investment increases after the implementation of environmental rules in CAS,and environmental investment has a negative impact on firm value;Borrowing cost capitalization increases after the implementation of environmental rules in heavily polluted companies,and borrowing cost capitalization has a positive impact on firm value;working capital decreases after the implementation of the environmental rules in CAS,but working capital has a positive impact on firm value;Government subsidies increase after the implementation of the environmental rules in CAS,and government subsidies have a positive impact on firm value.What makes this dissertation different is that we study the impact of environmental rules in CAS on firm value systematacially.Moreover,we test what we have analyzed theoretically using mediating model and structural equation model.Not only does this paper provide new ideas and perspectives to the study of consequence of CAS and enterprise value,but it also gives empirical evidence to enrich and improve the theoretical study of CAS and enterprise value.