Religious Tradition,Internal Control And Corporate Financial Restatement

Religious tradition affects individual behaviors by affecting individual personality,way of thinking and value orientation,and thus affects the behavior of social organizations.Therefore,religion can directly affect corporate governance by influencing corporate employees and management,and can indirectly influence corporate decision-making behavior by influencing business ethics so that research on the relationship between religion and macroeconomic development and corporate governance has become a hot topic in recent years.This article cuts from the perspective of religious tradition,based on the representative traditional religion in China—Buddhism to explore the impact of informal institutions in the external environment of enterprises on their financial restatement and internal control,and further analyzes the role of religious traditions.Specifically,this paper selects the A-share listed companies from 2010 to 2015 as a research sample,and uses the religious data of the provincial level to conduct empirical analysis to explore whether the religious traditional atmosphere of the headquarters of the listed company will affect the internal control and financial restatement and how the religious tradition affects corporate financial restatement.At the same time,this paper adopts different measurement indicators to test the robustness of the regression conclusions,making the empirical conclusions of the article more convincing.Finally,based on the above research conclusions,this paper expands the research and further explores the differences in the internal control and financial restatement of religious traditions under different legal environments and corporate nature so that this article reveals in depth the mechanism of influence of religious traditions as an informal system on businesses.First of all,this paper empirically finds that the stronger the religious tradition atmosphere of the listed company,the lower the probability of financial restatement,and the higher the internal control quality.Secondly,through the path test,this paper finds that the religious tradition has a significant path to reduce the financial restatement probability of the enterprise by influencing the internal control.That is to say,the religious tradition first affects the financial restatement of the enterprise by influencing the internal control.Finally,this paper expands the research and further discovers that:1.Compared to areas with lower legal systems,the role of religious traditions is more pronounced in areas with a high legal system environment,providing empirical evidence for religious traditions as an informal institution complementary to formal institutions.2.The religious tradition has a higher effect on state-owned enterprises than on private enterprises,revealing the influence of the nature of enterprises on the role of religious traditions.This paper enriches the research content of internal control and financial restatement influencing factors from the perspective of informal institutions,and has positive significance for improving the quality of internal control and reducing the probability of financial restatement of enterprises;the paper also reveals how religious traditions influence enterprises,supplementing previous research and enriching research in the field of religious economics.In today's society informal institutions are gaining more and more attention so that this paper is of great significance for revealing the mechanism that religious traditions affect the enterprise.