[Journal:] China Journal of Accounting Research [ISSN:] 1755-3091 [Volume:] 1 [Year:] 2008 [Pages:] 11-29
This paper investigates the factors affecting the conservatism of accounting reports at the market-level and firm-level. At the market-level, law and institutional factors explain conservatism, while at the firm-level contracting is the driver. We predict and observe that while both levels jointly affect conservatism, it is firm-level factors that play a dominant role. The conclusion suggests that it is more effective to improve the quality of accounting reports by motivating the firm's own demand rather than through listing in a developed capital market.
Accounting Conservatism market-level firm-level A-share companies H-share companies red chip companies, China, Hong Kong