Commercial Credit Financing Cost And Accounting Conservatism Research

Commercial credit financing is an important financing channel for enterprises.According to the theory of alternative financing,due to the “risk off”,banks have credit rationing in the financing channels and are not willing to loan to some business which are in risk,so these companies which loan from banks hardly only seek help from suppliers,and suppliers provide commercial credit financing.This is the reason why commercial credit exists widely in China.As the most important and influential principle in financial accounting measurement,accounting conservatism has a far-reaching impact on the accounting practice and accounting theory.In 2007,the "New Accounting Standards" issued by China clarified the status of accounting conservatism.However,most domestic researchers focus on existence,policy development and enterprise development,there is a paucity in the study of the economic effects of accounting conservatism.Due to the asymmetric information,the accounting conservatism becomes an effective way to enhance the value of the enterprise.Therefore,it has practical significance to study the relationship between accounting conservatism and commercial credit financing costs.For a long time,corporate finance theory research has been in an independent state and have less connection with other subjects.However,in the mid-1980 s,some scholars study the company's development strategy from the perspective of product market competition,breaking the independent state.Product market competition has become a factor of company strategy and company financial indicators.Commercial credit financing also plays a role of strategic commitment in product market competition,which delivers its strategic intent to suppliers and competitors through commercial credit financing costs.The degree of product market competition will not only affect the level of commercial credit financing costs,but also affect the soundness of accounting information.Based on the empirical research of previous scholars,this paper discusses the relationship between commercial credit financing and accounting conservatism from the perspective of product market competition.Combined with the background of the listed companies in our country,we verify that the more stable accounting information is,the lower the cost of commercial credit financing is.In highly competitive marketplace,the effect of accounting conservatism for reducing the cost of commercial credit financing is more obvious.According to the new accounting standards issued in 2008,we chose the data of listed companies from 2008 to 2015 to keep consistency of the data,and establishe the empirical model.We can reach the following conclusion: 1.With other conditions unchanged,the accounting conservatism is inversely related to the debt cost.2.The more intense competition in the product market,the more obvious effect of accounting conservatism on reducing the cost of acquiring commercial credit.