Institutional Investors,Internal Control And Accounting Conservatism

With the development of economic globalization,the company is facing more and more fierce market competition.If the company wants to maintain its advantages in the fierce market competition,it must enhance its own strength.In this context,improving the quality of the accounting information and keeping the accounting conservatism has become an important measure to enhance the company's competitiveness and reduce the risk of the company.As one of the the principles of the accounting treatment,accounting conservatism requires companies to promptly confirm the recognition of loss and postpone the recognition of income,so that the company's external investors can prevent the uncertain risk in advance.In recent years,due to the development of the global institutional investors and the promotion of the related policies in China,institutional investors are playing an increasingly important role in the capital market.The rapid development of the institutional investors will inevitably influence the quality of the financial reports of Chinese listed companies to a certain extent.In this context,using the data from 2012 to 2017 of Shanghai and Shenzhen A-share listed companies,this paper studies the relationship between the features of institutional investors,internal control quality and accounting conservatism,and tests the regulatory effect of internal control quality between the institutional investors and accounting conservatism.This study finds that institutional investors and accounting conservatism is positively related.Secondly,pressure resistant,foreign institutional investors can significantly improve the accounting conservatism,and pressure sensitive,domestic institutional investors cannot significantly improve the accounting conservatism.In addition,the study also finds that the internal control have the regulation role between institutional investors and accounting conservatism.Finally,the paper puts forward related policy suggestions of accounting conservatism,institutional investors and internal control based on the research results.