A Study of Accounting Conservatism in China's Capital Market

摘要

By collecting samples from all listed A-shares firms on Shenzhen and Shanghai Stock Exchanges from 2001 to 2007, we examines whether accounting conservatism exists in China's capital market since "Accounting System "(2001) has been implemented. Empirical results show that all listed companies are conservative during 2001 to 2007, besides, firms are more conservative on Shenzhen rather than on Shanghai Stock Exchanges. Moreover, conservatism doesn't result from the earning management behaviors of loss companies. Meanwhile, all of the profitable state-owned firms have conservatism as a whole. The loss state-owned firms don't have conservatism because of the motivation of taking upwards earning management. However, the non-state-owned firms perform conservatism, which has also been confirmed after eliminating the loss samples.