Research On The Relationship Between Political Connection,Audit Quality And Debt Financing

With the spring breeze of eighteen and the rapid development of private economy in our country,it has made great contribution to national employment and national taxation,which has become an important part of national economy.However,compared with the state-owned enterprises,the small and medium private enterprises in China still face multiple constraints on debt financing.In view of the special situation of our country,a large number of scarce resources are under the control of the government,so most of the small and medium-sized private enterprises in our country have actively established intimate relations with the government,thus seeking convenience for their own development.As a special resource of small and medium-sized private enterprises,political association can not only bring tax benefits,extra government subsidies,but also enhance the debt financing ability of enterprises.Political association is a network of relationships.The closer the relationship,the higher the degree of political connection.Does the degree of political connection have different effects on debt financing? Besides,political connection is an alternative mechanism established under imperfect institutional environment.With the improvement of institutional environment,the role of political connections in promoting debt financing of small and medium-sized private enterprises may gradually weaken.As an independent third party,independent audit is an alternative external protection mechanism,which can provide more reliable and reliable information to the creditor,alleviate the information asymmetry problem and protect the interests of the creditor.Since the 18 th Party and the government have actively created the fair competition environment of capital market,the independent auditing plays an increasingly important role in the capitalist market.So this paper attempts to start from the angle of audit quality,to explore whether the effect of debt financing can weaken the political association.This paper studies the method of combining theoretical analysis and empirical research.In the aspect of theoretical analysis,this paper studies the mechanism of political association ' s function on debt financing,analyzes the relationship between political association,audit quality and debt financing,and puts forward the research hypothesis.In this paper,we select 1497 samples of Shenzhen medium and small board listed private companies for 2014-2016 to establish an empirical model forresearch.The study found that: compared with the small and medium-sized private enterprises have no political association,political association of small and medium-sized private enterprises can get larger,longer term debt financing;the greater the degree of political connection,small and medium-sized private enterprises to obtain debt financing for larger,long-term debt to total debt ratio is higher;in consideration of audit quality under the condition of audit quality is higher,more can weaken the political relevance of debt financing scale,affect the debt maturity structure.Based on the above conclusions,this paper improves the management strength of small and medium-sized private enterprises,promotes the transformation of the government,exerts the role of market mechanism,and improves the legal system.This paper puts forward some policy suggestions on how to improve the audit quality of accounting firms,briefly introduces the limitations of the research,and looks forward to the future research direction.