State Minority Ownership and Financial Reporting Quality: Evidence from China's Private Sector

This paper investigates the impact of state-owned capital participation on the quality of accounting information in private enterprises. The study finds that an increase in the level of state-owned capital participation contributes to improving the quality of accounting information in private enterprises. Mechanism tests indicate that curbing asset stripping by major shareholders, reducing operational risks are key channels through which state-owned capital participation improves the quality of accounting information in private enterprises. These findings contribute to a deeper theoretical understanding of mixed-ownership reform in private enterprises, whilst also providing valuable insights for promoting improvements in corporate accounting information quality.