Can Investors Identify Accounting Conservatism Principle:Empirical Evidence from the Chinese Listed Companies

Based on the sample data of Chinese listed companies during 2001—2004 period,the study examines the issue whether investors can identify accounting conservatism.We find that the higher accounting conservatism,the higher valuation of creditors on book value of assets and shareholders on the net book value.For the enterprises with lower conservatism,creditors value highly on those with high accounting conservatism,while shareholders' taking the opposite assessment.This suggests that different types of investors can partly identify accounting conservatism.