Analysis On The Causes Of Listed Companies’ Use Of Asset Depreciation To Manipulate Profits

At the beginning of the formulation of the asset impairment standard,the company was able to truly reflect its own operating conditions and its own value,and to be able to release real and available financial information to the outside world.However,due to fierce competition among enterprises in recent years,many enterprises have encountered setbacks in their development.For the purpose of protecting their own interests and avoiding delisting,the phenomenon of internal use of asset impairment to manipulate profits is increasing.Although the Accounting Standards for Business Enterprises have restricted the reversal of long-term asset impairment to a certain extent in recent years,the room for profit manipulation has been curbed,but companies can still use other methods to manipulate profits.This article explores the motivations of listed companies’ profit manipulation and formulates corresponding countermeasures,hoping to further curb the space for companies to manipulate profits by using asset impairment.This article takes Xinji Energy Co.,Ltd.as a typical case,and obtains relevant information on its profits,asset impairment,and operating conditions by integrating relevant financial reports from 2006 to 2019.The total accrued profit model and the mean-reverted accrual profit model are used to test whether Xinji Energy has conducted profit manipulation,and the behavior of Xinji Energy to accrue asset impairment and manipulate profits is studied in stages.Combining GONE motivation theory and common profit manipulation motivations,it conducts in-depth analysis of its motivations,and analyzes the impact of changes in corporate accounting standards on its profit manipulation space.Finally,through the above analysis,we found the drawbacks of companies using asset impairment to manipulate profits,and gave suggestions and countermeasures applicable to listed companies to prevent internal fraud,and called on relevant departments to optimize the rules and systems as soon as possible and formulate more scientific audit management.,So as to promote the healthy development of society and economy.