An Empirical Study on the Relationship Between Corporate Ownership Structure and Quality of Accounting Information of China's Listed Companies in the Manufacturing Industry

With the rapid development of Chinese capital market in the last 18 years, recently the quality of accounting information of listed companies, which is crucial for the sustainable improvement of the capital market efficiency, has become the focus issue to investors, scholars and government. The main purpose of this paper is to test and explore the relationship between corporate ownership structure and quality of accounting information of China's listed companies. This paper extends earlier research with focusing on a particular industry, the manufacturing industry. This study uses 32 listed companies in the manufacture industry punished by China Securities Regulatory Commission (CSRC) for their financial statement fraud (FSF) during 2002 and 2006, and employs the method of descriptive statistical analysis, correlate analysis and logistic regression analysis, in which the total assets are used as the control variable, to examine the relationship. The results indicate that the higher the proportion of state owned shares and the lower the proportion of tradable shares, the more likely FSF to happen. This study also finds that FSF is even more frequent for companies with State Assets Management Bureau as the biggest shareholder.