Abstract: Conservatism reporting is an essential information infrastructure for corporate transparency and investors protections. Utilizing the new method for measuring accounting information conservatism which put forward by Khan et al（2009）. The paper finds that the valuation of cash holdings by external investors increases with the accounting information conservatism. The above positive relationship becomes even stronger with the improvement of financial development environment. The research indicates that with the development of financial development environment, the investors add more emphasis to conservative accounting information reporting as its determinant role in capital allocation efficiency and pricing. The study for the first time provides answers for “who need conservative accounting information”, an important research topic unexplored.