The Effect Of Securities Lending Mechanism On The Quality Of Corporate Earnings From The Perspective Of Accounting And Taxation Differences

Since the introduction of the two-financing business in china in 2010,the "bilateral" market,which can be used for financing and securities lending,has played an important role in enriching transaction business,capital allocation efficiency,stabilizing the capital market,and controlling stock price volatility.After several expansions,so far about one-third of all A-share companies have become targets for margin trading and securities lending.The emergence of margin trading and securities lending business not only has a significant impact on the capital market,but its impact on the internal governance of the company is also worthy of attention.Margin and securities lending mechanisms,especially securities lending,increase the effectiveness of information transmission by introducing negative information into transaction decisions,improve the asymmetry of internal and external information within the enterprise,and produce an effect like external supervision,which affects the internal governance of the company.Within the company,the quality of earnings is the focus of all stakeholders.This article regards the emergence of the two-financing business and the subsequent expansion process as several "quasi-natural" experimental processes,and the accounting and taxation differences as an agent of earnings quality,to study the impact that the appearance of external margin financing and securities lending business on internal company.Based on the data of A-share margin trading target companies from 2010 to 2018,this article finds:(1)The Securities Lending mechanism can identify companies’ accounting tax differences,and companies with larger accounting tax differences are also more active in short selling;(2)Compared with companies that have not become the target of margin trading and securities lending,after becoming the target,the degree of differences in accounting taxation of the sample companies is significantly reduced,the mechanism of margin financing and securities lending has a governance effect;(3)Compared with companies with perfect internal control,The restraining effect of securities lending mechanism on accounting tax differences is more obvious in companies with defects in internal control.The above conclusions all show the positive effect of the margin financing and securities lending mechanism on the company’s internal governance,which can not only improve the quality of disclosed earnings,but also have a "replenishment" effect on internal control.The research in this article has perfected the two-way influence system of "company internal governance-capital market policy",enriched the research perspectives on earnings quality,and provided new data support for the positive effects of margin financing and securities lending.The research results of this article are of practical significance for further relaxing the control of short-selling,expanding the scope of margin financing and securities lending,improving the capital market,and deepening financial reforms,and making finance better help the real economy.