The paper provides more direct evidence on the causal relation between the quality of financial reporting and investment efficiency by studying the investment behavior before and after the listed firms announced their financial statement restatement. The accounting error corrections disclosed by the listed firms in their annual reports from 2006 to 2009 are restatement samples. This paper uses two different procedures such as PSM to obtain control samples to examine the investment efficiency change before and after the listed firms announced their financial statement restatement. The results suggest that: 1) Prior to the announcement, the restatement firms under invest when they are financially constrained and over invest when they are financially unconstrained; 2) More importantly, after the announcement, these listed firms investment efficiency improves significantly.