R&D Investment Growth,reduction Of Major Shareholders And Accounting Information Quality

In the report of the 19 th National Congress of the Communist Party of China,it has been clearly pointed out that innovation,as the engine of development,has now become the first source of development.In addition,innovation-related vocabulary has also become a high-frequency vocabulary in this report:10 times in the report mentioned technology,and the importance of innovation was emphasized for over 50 times.It can be foreseen that by 2035,the two major business cards,"Creation in China" and "Intelligence in China",will help China take the top spot in innovative countries.It can be seen that the size of research and development capabilities has become an important factor in the development and growth of enterprises.The rising costs of R&D investment have also become an inevitable trend in society.With the dramatic increase in investment in R&D expenditure,the huge amount of expenditure will have a major impact on the financial status of the company.On the one hand,R&D investment itself has the characteristics of flexibility and subjectivity;on the other hand,the relevant laws and regulations of the company and the internal control system has the characteristics of relative lag,which gives the manager surplus management space,affecting the company's performance and related profit indicators,thereby reducing the quality of corporate accounting information.At the same time,as an important platform for China's science and technology innovation enterprise financing,GEM has its policy advantages as well as some disadvantages.For examples,innovative companies have not been established for a long time,the governance structure is relatively imperfect,the business is relatively single,and there are risks.Such disadvantages also give the management of innovative companies the opportunity to use their growing R&D investment to manipulate accounting information.In addition,with the arrival of the lifting of the ban period and the rise in the stock price,the reduction of holdings and resignations of major shareholders of the GEM has increased.Given the lack of effective managers in the Chinese market,will it cooperate with its own power and influence by the reduction of holdings for earnings management to reduce the quality of accounting information? Will the accounting information be manipulated by adjusting R&D investment growth? Therefore,given the continuous increase in the amount and importance of R&D investment,the subjectivity of accounting policy choices in R&D activities,the prevalence of reduction of major shareholders of companies listed on the GEM,and the urgent need for transformation of the corporate economy,this paper focuses on Research on the relationship among R&D investment,reduction of major shareholders,and quality of accounting information.This article takes the GEM listed companies from 2012 to 2016 as the research object.It mainly studies the influence and direction of the R&D investment growth on the quality of accounting information and the effect of the reduction of large shareholders on the relationship between the two.There are two main research conclusions: First,in the current environment,the growth of corporate R&D investment will not only help improve the company's ability to innovate,but also may have a negative impact on the quality of accounting information.Second,in the event of major shareholder reductions,the negative effect of corporate R&D investment on the quality of accounting information is even more pronounced.In response to the results above,this paper proposes the following recommendations: First,improve and refine the relevant content of R&D investment criteria,and reduce the flexibility of R&D investment accounting;Second,increase the investment in R&D and timely improve the internal control system of the company,ensure timeliness of the internal control system,strengthen the internal and external supervision of R&D expenditure growth and increase the effective R&D investment of enterprises;Third,standardize the behaviors of major shareholders to reduce holdings,identify the motivations of major shareholders to reduce their holdings and prevent major shareholders from reducing their holdings for cash purposes such as cashing out.This article focuses on the relationship between R&D investment growth and the quality of accounting information under the background of innovation.It will help improve the innovation development of companies and the behaviors in the increase of R&D investment and the shareholder reductions,and the quality of accounting information,providing a theoretical support for increasing effective R&D investment,better implementing the spirit of the Nineteenth Party Congress and creating a more healthy and positive market environment for the sustainable development of companies.