Using financial reports of AB-share listed companies in China from 1996 to 2003, this paper attempts to evaluate the impact of accounting internationalization in China by comparing time serial value-relevance differences between Chinese Accounting Standards (CAS) and International Accounting Standards (IAS). Empirical evidence from relative information content test indicates that unexpected earnings reported under IAS have more information content to A-share investors than those under CAS. However, the relative value-relevance of IAS is weakened through the accounting internationalization process. Moreover, empirical evidence from incremental information content test shows that the incremental value-relevance of IAS is also weakened through the accounting harmonization process. Further empirical evidence demonstrates that CAS earnings appear to substitute for CAS earnings in the valuation process to the extent to which CAS is harmonized with IAS.

This study attempts to shed light on the relationship between related-party (RP) transactions and internal governance factors of China’s listed companies. An analysis of a sample of 69 049 RP transactions during 2002–2006 reveals strong evidence that the likelihood of RP transactions is higher for companies with high concentration of ownership, but lower for companies with strong bargaining power of the second and third largest shareholders. There is also clear evidence showing that large compensation for outside directors is associated with greater size of RP transactions, whereas increased average compensation for the three top executives tends to decrease the number of RP transactions. Our results also reveal that the pluralism arraignment, i.e. the same person holding both positions of the board chairman and the chief executive, increases the size of RP transactions significantly. This finding suggests that pluralism reduces the balance of power in corporate governance.

This paper argues that the political resources owned by Chinese private enterprises affect their diversification strategy under the context of China’s transitional economy. Based on the sample of top 500 private enterprises in 2004 in China, we find the following empirical evidence: First, political resources owned by private enterprises are positively and significantly related to their degree of diversification. Second, the possibility for private enterprises to diversify their business by entering industries under government regulation is positively related to their political resources. Third, the possibility of related diversification for private enterprise is negatively related to its political resources.

This paper studies 148 related and 169 unrelated acquisition cases conducted by Chinese listed firms from 2001 to 2004 and explores firm and industry characteristics of these firms prior to their acquisition. Results show that there are significant pre-acquisition differences between firms pursuing related acquisition and firms pursuing unrelated acquisition in terms of firm performance, business risk, firm size, proportion of state shares and degree of diversification profile. Except for differences in internal capital as represented by undistributed profit per share, there is no significant difference in other aspects of available resources and industry performance.

The organizational learning construct and its effective mechanism are two research issues. This study is based on a survey of 908 managers and employees from 43 companies in different regions of China. The results of exploratory factor analysis (EFA) and confirmatory factor analysis (CFA) show that organizational learning in Chinese enterprises is a multi-dimensional construct comprising of inter-organizational learning, organization-level learning, collective learning, individual learning, exploitation learning and exploration learning. The results of hierarchical linear modeling (HLM) reveal that the unit-level dimensions of organizational learning affect employee’s satisfaction and emotional commitment through the mediation of individual learning. In organizations characterized by high level of organization-level learning and low level of exploitation learning, there is a strong correlation between employees’ satisfaction/emotional commitment and their turnover intention. Hierarchical regression analysis (HRA) also indicates that organizational learning affects perceived organizational financial performance through the full mediation of organizational innovation. Some implications are discussed for organizational learning research and practice.

While knowledge exploration and exploitation represent two distinct activities requiring corresponding organizational arrangements, new product development calls for a dynamic combination of the two. Based on a systematic review of the paradox between knowledge exploration and exploitation and various resolving strategies, this research extends the construct of organizational ambidexterity from dual structure to ambidextrous capabilities, and suggests a dialectical method for reconciling this paradox at lower organizational levels. Based on a case study on the development teams of air conditioner in Haier, we find that ambidexterity is a multi-level construct existing not only at the organization level but also at lower levels such as teams and individuals like model managers.

This paper examines cash flow management in the Chinese market and compares it to that in the U.S. market. It adopts Burgstahler and Dichev(1997) and Degeorge et al.’s (1999) method and the best-fitted distribution model to analyze the financial data of Chinese listed firms during 1998–2005 and the forecasted cash flow per share (CPS) data for Chinese firms in the I/B/E/S database during 1993–2005. Results reveal that cash flows reports are not as reliable as people think, and managers manipulate cash flows just as they manipulate earnings. Further analyses show that zero point, last year’s cash flow and analyst cash flow forecast are the three thresholds that influence managers’ decision when they report cash flow performance. Over 16% of the firms with small positive cash flows manipulate their cash flow. Moreover, 16.64% of the firms with small changes in cash flow and 9.81% of the firms with small surprises manipulate cash flows to reach the targets. A comparative analysis shows that cash flow management behaviors around zero and zero changes are more prevalent in the Chinese market than in the U.S. market. Cash flow management around analyst cash flow forecasts, however, is no more prevalent than that in the U.S. market.

Channel alliance is regarded as the most advanced form of channel relationships. The extant literature mainly focuses on commitment, trust, communication and cooperation as influencing factors of channel alliance relationship. This paper empirically explores influencing factors of channel alliance relationship in Chinese enterprises, and their respective degrees of influence, particularly those of personal relationship and government administrative factors. Research hypotheses were tasted based on a survey of automobile vendors and dealers. Three most important influencing factors were identified “commitment and trust”, “communication and cooperation”, and “returns”.