( 您好!臺灣時間:2021/04/17 16:40
字體大小: 字級放大   字級縮小   預設字形  


論文名稱(外文):In the Name of Related-Party Transactions - Cases from China
指導教授(外文):SHU, PEI-GI
外文關鍵詞:Related-Party TransactionsAudit OpinionInvestment-Cash Flow Sensitivity
  • 被引用被引用:0
  • 點閱點閱:61
  • 評分評分:系統版面圖檔系統版面圖檔系統版面圖檔系統版面圖檔系統版面圖檔
  • 下載下載:0
  • 收藏至我的研究室書目清單書目收藏:0
本研究透過兩個平台探究關聯方交易的效果:會計師審計意見以及投資現金流量敏感度。探討審計意見是基於過去研究提及關聯方交易成為控制股東從事資產掏空(e.g. Jiang, Lee & Yue, 2010; Friedman, Johnson & Mitton, 2003) 或盈餘管理的管道 (e.g. Jian & Wong, 2010; Aharony, Wang & Yuan, 2010; Chen, Cheng & Xiao, 2011), 基於此,簽證會計師對於高幅度的關聯方交易應抱持負面的態度。本研究使用中國大陸上市公司於2006年至2014年樣本期間共5,684筆公司—年資料證實,使用高水位關聯方交易的公司確實比較容易收到會計師負面的審計意見,且不論關聯方交易的類別為何,以及關聯方交易是否考慮內生性的議題,二者負向關係皆顯著。


In this study I examine the role of related-party transaction (RPT hereafter) via two platforms: audit opinion and the investment-cash flow sensitivity. The platform of audit opinion is of interest if RPT has been deemed a possible channel for controlling owners to engage in wealth expropriation (e.g. Jiang, Lee & Yue, 2010; Friedman, Johnson & Mitton, 2003) or earnings management (e.g. Jian & Wong, 2010; Aharony, Wang & Yuan, 2010; Chen, Cheng & Xiao, 2011), attested auditors should respond negatively to firms with high-level RPT. Using a sample consisting of 5,684 firm-year observations from listed firms in China in the sampling period of 2006-2014, I find that firms with high-level RPT are more likely to receive adverse audit opinions, no matter what types of RPT being examined or whether RPT has been taken account of the endogeneity issue.

The platform of investment-cash sensitivity (ICS hereafter) is of interest because the cash flow indebted to RPT might weaken ICS for alleviating the negative impact of information asymmetry between fund-deficient firms and external capital market, or heightened ICS for aggravating the negative impact due to agency problem embedded in free cash flow. I find that RPT in general alleviates ICS. A further analysis of different RPT categories indicates that simple RPT alleviates while complex RPT aggravates ICS, indicating that simple RPT helps alleviate information asymmetry that results in underinvestment, while complex RPT aggravates agency problems that result in overinvestment. Furthermore, RPT sales have no significant impact on ICS while RPT purchases heighten ICS, implying that firms in bottom of pyramidal structure are more likely to engage in propping up through RTP purchases. These propping-up firms are more likely to confront with cash-deficient problems that result in heightened ICS. Finally, I find that RPT guarantee alleviates ICS, implying that firms rendering guarantee for RPT loans or project performance might self-restrict in cash abuse that results in a reduction in overinvestment and therefore a weakened ICS.

1. Introduction 1
2. Institutional Background 7
2.1. Background on Related Party Transactions 7
2.2. Audit Market in China 9
2.3. Revisions of RPTs Disclosure Requirements 10
3. Literature Review and Hypothesis Developments 12
3.1. Motivations of Using RPTs 12
3.2. RPTs and Audit Opinion 14
3.3. RPTs and Investment-Cash Flow Sensitivity 18
4. Data, Variables and Models 23
4.1. RPT and Audit Opinion 27
4.2. RPT and Investment-Cash Flow Sensitivity 36
5. Concluding Remark 44

References 47

1.Aharony, J., Wang, J. & Yuan, H. (2010). Tunneling as an incentive for earnings management during the IPO process in China. Journal of Accounting & Public Policy, 29(1), 1-26.
2.Amihud, Y., & Mendelson, H. (1988). Liquidity and asset prices: Financial management implications. Financial Management, 17, 5-15.
3.Bartov, E., Gul, F. A., & Tsui, J. S. (2000). Discretionary-accruals models and audit qualifications. Journal of accounting and economics, 30(3), 421-452.
4.Berkman, H., Cole, R. A., & Fu, L. J. (2009). Expropriation through loan guarantees to related parties: Evidence from China. Journal of Banking & Finance, 33(1), 141-156.
5.Bertrand, M., Mehta, P., & Mullainathan, S. (2002). Ferreting out tunneling: An application to Indian business groups. The Quarterly Journal of Economics, 117(1), 121-148.
6.Bradshaw, M. T., Richardson, S. A., & Sloan, R. G. (2001). Do analysts and auditors use information in accruals? Journal of Accounting research, 39(1), 45-74.
7.Brennan, M. J., & Subrahmanyam, A. (1996). Market microstructure and asset pricing: On the compensation for illiquidity in stock returns. Journal of Financial Economics, 41(3), 441-464.
8.Chan, K. H., Lin, K. Z., & Mo, P. L. L. (2006). A political–economic analysis of auditor reporting and auditor switches. Review of Accounting Studies, 11(1), 21-48.
9.Chan, K. H., Lin, K. Z., & Wang, R. R. (2012). Government ownership, accounting-based regulations, and the pursuit of favorable audit opinions: Evidence from China. Auditing: A Journal of Practice & Theory, 31(4), 47-64.
10.Chen, H. J., & Chen, S. J. (2012). Investment-cash flow sensitivity cannot be a good measure of financial constraints: Evidence from the time series. Journal of Financial Economics, 103(2), 393-410.
11.Chen, J. J., Cheng, P., & Xiao, X. (2011). Related party transactions as a source of earnings management. Applied Financial Economics, 21(3), 165-181.
12.Choi, S. K., & Jeter, D. C. (1992). The effects of qualified audit opinions on earnings response coefficients. Journal of Accounting and Economics, 15(2-3), 229-247.
13.Cleary, S., Povel, P., & Raith, M. (2007). The U-shaped investment curve: Theory and evidence. Journal of financial and quantitative analysis, 42(1), 1-39.
14.Cleary, S. (1999). The relationship between firm investment and financial status. The Journal of Finance, 54(2), 673-692.
15.Clogg, C. C., Petkova, E., & Haritou, A. (1995). Statistical methods for comparing regression coefficients between models. American Journal of Sociology, 100(5), 1261-1293.
16.Coase, R. H. (1937). The nature of the firm. Eeconomica, 4(16), 386-405.
17.DeFond, M. L., Raghunandan, K., & Subramanyam, K. R. (2002). Do non–audit service fees impair auditor independence? Evidence from going concern audit opinions. Journal of AccountingResearch, 40(4), 1247-1274.
18.Djankov, S., La Porta, R., Lopez-de-Silanes, F., & Shleifer, A. (2008). The law and economics of self-dealing. Journal of Financial Economics, 88(3), 430-465.
19.Dopuch, N., Holthausen, R. W., & Leftwich, R. W. (1986). Abnormal stock returns associated with media disclosures of ‘‘subject to’’qualified audit opinions. Journal of Accounting and Economics, 8(2), 93-117.
20.Easley, D., & O'hara, M. (2004). Information and the cost of capital. The Journal of Finance, 59(4), 1553-1583.
21.Fazzari, S. M., Hubbard, R. G., Petersen, B. C., Blinder, A. S., & Poterba, J. M. (1988). Financing constraints and corporate investment. Brookings papers on economic activity, 1988(1), 141-206.
22.Firth, M., Mo, P. L., & Wong, R. M. (2005). Financial statement frauds and auditor sanctions: An analysis of enforcement actions in China. Journal of Business Ethics, 62(4), 367-381.
23.Firth, M., Mo, P. L., & Wong, R. M. (2012). Auditors’ organizational form, legal liability, and reporting conservatism: Evidence from China. Contemporary Accounting Research, 29(1), 57-93.
24.Fisman, R. & Wang, Y. (2010). Trading favors within Chinese business groups. American Economic Review, 100(2), 429-433.
25.Francis, J. R., & Krishnan, J. (1999). Accounting accruals and auditor reporting conservatism. Contemporary Accounting Research, 16(1), 135-165.
26.Friedman, E., Johnson, S., & Mitton, T. (2003). Propping and tunneling. Journal of Comparative Economics, 31(4), 732-750.
27.Gallizo, J. L., & Saladrigues, R. (2016). An analysis of determinants of going concern audit opinion: Evidence from Spain stock exchange. Intangible Capital, 12(1), 1-16.
28.Gordon, E. A., Henry, E., Louwers, T. J., & Reed, B. J. (2007). Auditing related party transactions: A literature overview and research synthesis. Accounting Horizons, 21(1), 81-102.
29.Greenwald, B. C., Stiglitz, J. E., & Weiss, A. (1984). Informational imperfections in the capital market and macro-economic fluctuations, NBER Working Paper No. 1335.
30.Grossman, S. J., & Hart, O. (1987). Vertical integration and the distribution of property rights. Economic Policy in Theory and Practice (pp. 504-548). Palgrave Macmillan, London.
31.Hadlock, C. J., & Pierce, J. R. (2010). New evidence on measuring financial constraints: Moving beyond the KZ index. The Review of Financial Studies, 23(5), 1909-1940.
32.He, K., Pan, X., & Tian, G. (2017). Legal liability, government intervention, and auditor behavior: Evidence from structural reform of audit firms in China. European accounting review, 26(1), 61-95.
33.Hopwood, W., McKeown, J., & Mutchler, J. (1989). A test of the incremental explanatory power of opinions qualified for consistency and uncertainty. Accounting Review, 64, 28-48.
34.Hoshi, T., Kashyap, A., & Scharfstein, D. (1991). Corporate structure, liquidity, and investment: Evidence from Japanese industrial groups. The Quarterly Journal of Economics, 106(1), 33-60.
35.Hu, S., Shen, Y.,& Xu, Y. (2009). Determinants of related-party transactions: Evidence from China’s listed companies during 2002–2006. Frontiers of Business Research in China, 3(2), 190-206.
36.Hubbard, R. G. (1998). Capital-market imperfections and investment. Journal of Economic Literature, 36(1), 193-225.
37.Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of financial economics, 3(4), 305-360.
38.Jensen, M. C. (1986). Agency costs of free cash flow, corporate finance, and takeovers. The American economic review, 76(2), 323-329.
39.Jia, N., Shi, J., & Wang, Y. (2013). Coinsurance within business groups: Evidence from related party transactions in an emerging market. Management Science, 59(10), 2295-2313.
40.Jian, M., & Wong, T. J. (2010). Propping through related party transactions. Review of Accounting Studies, 15(1), 70-105.
41.Jiang, G., Lee, C. M. C., & Yue, H. (2010). Tunneling through intercorporate loans: the china experience. Journal of Financial Economics, 98(1), 1-20.
42.Johnson, S., Porta, R. L., & Shleifer, A. (2000). Tunneling. American Economic Review, 90(2), 22-27.
43.Kadapakkam, P. R., Kumar, P. C., & Riddick, L. A. (1998). The impact of cash flows and firm size on investment: The international evidence. Journal of banking & Finance, 22(3), 293-320.
44.Kaplan, S. N., & Zingales, L. (1995). Do financing constraints explain why investment is correlated with cash flow?. Quarterly Journal of Economics, 112, 169–216.
45.Keasey, K., Watson, R., & Wynarczyk, P. (1988). The small company audit qualification: a preliminary investigation. Accounting and Business Research, 18(72), 323-334.
46.Kennedy, D. B., & Shaw, W. H. (1991). Evaluating financial distress resolution using prior audit opinions. Contemporary Accounting Research, 8(1), 97-114.
47.Khanna, T., & Palepu, K. (2000). Is group affiliation profitable in emerging markets? an analysis of diversified indian business groups. Journal of Finance, 55(2), 867-891.
48.Khanna, T., & Yafeh, Y. (2007). Business groups in emerging markets: Paragons or parasites?. Journal of Economic literature, 45(2), 331-372.
49.Kohlbeck, M., & Mayhew, B. W. (2010). Valuation of firms that disclose related party transactions. Journal of Accounting and Public Policy, 29(2), 115-137.
50.La Porta, R., Lopez-de-Silanes, F., & Zamarripa, G. (2003). Related lending. The Quarterly Journal of Economics, 118(1), 231-268.
51.Lamont, O., Polk, C., & Saaá-Requejo, J. (2001). Financial constraints and stock returns. The Review of Financial Studies, 14(2), 529-554.
52.Le Maux, J. (2004). Les déterminants de l’ampleur des bénéfices privés: un test sur données françaises. Revue Finance Contrôle Stratégie, 7(2), 195-231.
53.Lo, A. W., Wong, R. M., & Firth, M. (2010). Can corporate governance deter management from manipulating earnings? Evidence from related-party sales transactions in China. Journal of Corporate Finance, 16(2), 225-235.
54.Lo, A. W., & Wong, R. M. (2016). Silence is golden? Evidence from disclosing related-party transactions in China. Journal of Accounting and Public Policy, 35(5), 540-564.
55.Lo, A. W., Wong, R. M., & Firth, M. (2010a). Tax, financial reporting, and tunneling incentives for income shifting: An empirical analysis of the transfer pricing behavior of Chinese-listed companies. Journal of the American Taxation Association, 32(2), 1-26.
56.Lo, A. W. Y., Wong, R. M. K., & Firth, M. (2010b). Can corporate governance deter management from manipulating earnings? evidence from related-party sales transactions in china. Journal of Corporate Finance, 16(2), 225-235.
57.Lo, F. Y.(2013). Marketization, related transaction and investment efficiency. Journal of Zhongnan University of Economics and Law, 196(1), 115-121.
58.Meyer, K. E. (2001). Institutions, transaction costs, and entry mode choice in Eastern Europe. Journal of international business studies, 32(2), 357-367.
59.Modigliani, F., & Miller, M. H. (1958). The cost of capital, corporation finance and the theory of investment. The American Economic Review, 48(3), 261-297.
60.Myers, S. C., & Majluf, N. S. (1984). Corporate financing and investment decisions when firms have information that investors do not have. Journal of financial economics, 13(2), 187-221.
61.Nekhili, M., & Cherif, M. (2011). Related parties transactions and firm's market value: The French case. Review of Accounting and Finance, 10(3), 291-315.
62.Peng, W. Q., Wei, K. J., & Yang, Z. (2011). Tunneling or propping: Evidence from connected transactions in China. Journal of Corporate Finance, 17(2), 306-325.
63.Richardson, S. (2006). Over-investment of free cash flow. Review of Accounting Studies, 11(2-3), 159-189.
64.Ryngaert, M., & Thomas, S. (2012). Not all related party transactions (RPTs) are the same: Ex ante versus ex post RPTs. Journal of Accounting Research, 50(3), 845–882.
65.Shin, H. H., & Park, Y. S. (1999). Financing constraints and internal capital markets: Evidence from Koreanchaebols'. Journal of Corporate Finance, 5(2), 169-191.
66.Stulz, R. (1990). Managerial discretion and optimal financing policies. Journal of financial Economics, 26(1), 3-27.
67.Wang, Q., Wong, T. J., & Xia, L. (2008). State ownership, the institutional environment, and auditor choice: Evidence from China. Journal of accounting and economics, 46(1), 112-134.
68.Whited, T. M. (1992). Debt, liquidity constraints, and corporate investment: Evidence from panel data. The Journal of Finance, 47(4), 1425-1460.
69.Whited, T. M., & Wu, G. (2006). Financial constraints risk. The Review of Financial Studies, 19(2), 531-559.
70.Wong, R. M., Kim, J. B., & Lo, A. W. (2015). Are Related‐Party Sales Value‐Adding or Value‐Destroying? Evidence from China. Journal of International Financial Management & Accounting, 26(1), 1-38.
71.Yeh, Y. H., Shu, P. G., & Su, Y. H. (2012). Related-party transactions and corporate governance: The evidence from the Taiwan stock market. Pacific-Basin Finance Journal, 20(5), 755-776.
72.Zhu, L. L. 2006. Corporate governance, related party transactions and firm value. Working paper. (In Chinese).

電子全文 電子全文(網際網路公開日期:20230801)
第一頁 上一頁 下一頁 最後一頁 top
系統版面圖檔 系統版面圖檔