Risk Disclosure In Annual Report And Financing Constrains

The global stock market is violently fluctuating,and market participants are increasingly demanding risk information.National regulators are required to disclose risk information.China's 2007 "Contents and Formats of Annual Reports" began to mandate disclosure of risk information,and continued to strengthen risk disclosure requirements in two revisions in 2012 and 2014.Due to the heterogeneity and uncertainty of risk information,the company's willingness to disclose is insufficient.Facing with high cost of external financing and non-sufficient internal cash flow,instead of raising funds,the enterprises have to give up some investment projects,even though they have favorable investment opportunities.In this way,they will fall into the financing constraints.High-quality information disclosure can effectively alleviate the degree of information asymmetry in the market,and then alleviate the financing constraints faced by enterprises.However,due to the particularity of risk information,it is still unclear whether it can alleviate financing constraints.Annual report risk disclosure may not only improve the quality of information but also have a positive impact on financing constraints,and may also have a negative impact on financing constraints by increasing investors' risk perception.Making research on the impact of risk disclosure on financing constraints is of great significance to alleviate the financing dilemma of enterprises.It explores the value relevance and information nature of the risk disclosure of annual reports o'f listed companies in China by summarizing,comparing,analyzing,combining with the theory of information asymmetry,the problems studied in risk disclosure and the problems studied by financing constraints.First of all,based on the study of domestic and international research literature on risk information disclosure and financing constraints,the paper finds the entry point of the article and leads to the research topic.Then,it expounds the theory related to risk disclosure and financing constraints,and analyzes and demonstrates the relationship between the two,and puts forward the research hypothesis of this topic.Finally,based on the above analysis and research,an empirical model of risk disclosure and financing constraints is established,and the fixed effect model is used for verification.Based on the research of Shanghai-Shenzhen A-share listed companies in 2012-2017,the more risks disclosed by the company,the more it can alleviate the financing constraints faced by the company.This indicates that the more risk factors a company discloses,the more trust the market gives,and the lower the risk premium required.Further research finds that from the perspective of property rights heterogeneity,compared with state-owned enterprises,risk disclosure in non-state-owned enterprises has a more significant mitigation effect on financing constraints;compared with internal control quality,high quality internal control In the environment,risk mitigation has a more significant mitigation effect on financing constraints.This paper examines the impact of China,s annual report risk disclosure on financing eonstraints,and enriches the relevant literature on risk information disclosure.The above conclusions are still established after the robustness test and have practical economic consequences.