A Study On The Relationship Between Accounting Comparability And Debt Costs Of Listed Companies In China

Since the new accounting standards which aimed to promote the substantive convergence of China's accounting standards and international accounting standards promulgated,China's accounting standards have undergone a series of adjustments and improvements to keep up with international accounting standards,and improve the accounting information of enterprises and institutions,which puts forward requirements for the study of the accounting comparability.However,since comparability is a relative index,it is difficult to be measured.Therefore,compared with other characteristics of accounting information quality,the research on accounting comparability develops very slowly.Most of the previous literatures measured accounting comparability indirectly from the perspective of accounting standards' coordination,which do not grasp the essential connotation of comparability.Until De Franco et al(2011)created a model to measure comparability at the company level,the research on accounting comparability made a substantial progress.At present,researches on accounting comparability's economic consequences mainly focus on analysts' follow-up,investment efficiency and earnings management.Few scholars study the impact of comparability on debt costs.Debt financing decision-making is one of the major decisions of enterprises,thus it is necessary to conduct research on the relationship between accounting comparability and dept costs.Therefore,this paper selects the perspective of accounting comparability to explore its impact on debt costs.This paper firstly uses transaction cost theory,information asymmetry theory and principal-agent theory to analyze the theoretical mechanism of the impact of accounting comparability on debt costs.Based on it,takes China's A-share listed companies in 2010-2017 as the research object to explore the impact of accounting comparability on debt costs.Further,property rights and audit quality are taken into account as internal and external factors to examine whether these two factors have impacts on the relationship between accounting comparability and debt costs.The results show that:(1)The accounting comparability is significantly negatively correlated with the debt costs,which shows that accounting comparability is useful in decision-making for creditors.The higher accounting comparability is,the lower debt costs are.(2)Compared with state-owned enterprises,the negative correlation between accounting comparability and debt costs is more significant in non-state-owned enterprises.This is because that state-owned enterprises have “hidden guarantees” and creditors' concerns about corporate credit risks are greatly reduced.Thus,creditors' attention to accounting comparability has been greatly reduced.Therefore,for state-owned enterprises,accounting comparability will fail in pricing on debt costs.(3)Compared with enterprises of higher audit quality,the negative correlation between accounting comparability and debt costs is more significant in enterprises of lower audit quality,because when the audit quality is higher,creditors will rely on audit quality to a large extent,which weakens accounting comparability's impact on dept costs.These conclusions are still robust after being tested.This paper enriches the research literature of accounting comparability's economic consequences,and the results provide some theoretical references for relevant departments to improve accounting standards and auditing regulations so that accounting comparability and audit quality can be improved,and accelerate the property rights reform of state-owned enterprises.