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Government Intervention and Earnings Quality in China--Based on the Evidence from Listed Companies of A Stock Markets |
Zhu Cha-Fen |
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Abstract This paper examines the relationship between government intervention and accounting reporting. Firstly, in order to hide the intervention behavior, government bureaucrats have strong incentives to prevent firms from reporting information timely and transparently. Secondly, bureaucrats indulge firms’ earning management to reach his own performance goals. The empirical results show that government intervention has indeed hurts earnings’ quality of listed companies measured by earnings informativeness and earnings conservatism, furthermore, the negative impact is more serious on state-owned companies. Our results provide important policy implications.
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Received: 23 December 2008
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Corresponding Authors:
Zhu Cha-Fen
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