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Studies On Earnings Management Of Chinese Listed Companies

Posted on:2004-06-15Degree:MasterType:Thesis
Country:ChinaCandidate:L X ShengFull Text:PDF
GTID:2156360125955117Subject:Political economy
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This paper explores statistic features of earnings information disclosure and whether public issuing institution distinctly has an effect on earnings management of Chinese listed companies.In this way,major purpose is to verify that earnings management exactly exists in Chinese listed companies.This research has paved the way for further studies on economical factors.On the basis of the study above,this paper tries to meet an important intention to improve efficiency of Chinese securities market,boost the validity of supervising earnings management,and provide advices on effectively detecting and preventing from earnings management.1. Statistical distribution of Return of equity(ROE) presents dense distribution around earnings benchmark.And evolution of earnings benchmark remarkably has an influence on earnings management of listed company. Statistic result that dense field presents whole movement along with institution evolution particularly in the critical point, proves the point mentioned above.2.By positive studies,the phenomenon of earnings management of listed company is ubiquitous indeed.The listed companies ,which attain the right of rationed share acquisition and avoid being delisted due to a loss for the last 3 consecutive years,have the most strong motivation of manipulating the earnings.Major reasons are as follows:right of rationed share acquisition and secondary financing is an important scarce resource and has rich income,which correlates closely with Chinese specific securities issuing institution .Anyway,it slowly becomes milder along with more perfect supervisal institution.S.Chinese securities market is still an immature one and its institution constraints need further perfect. Institution evolution prompts information disclosure of listed company to shows that abnormal react of listed company result from a new institution enforcement.In general,however,Chinese securities market increasingly trends towards maturity.And the decree,which China Securities Regulatory Commission enacts, is effective to add violation cost and has their power to deter.4.Earnings management is a kind of rational behavior.Contracting frictions betweenlisted companies and the other sides shows that behavior of earnings management is inevitable.And asymmetrical information provides possibility.Besides those two points,listed companies also have a great diversity of motivations and ways.5.Based on analysis of cost and income of earnings management,it is out of question that income exceeds far from cost.As a result from Chinese specific issuing institution,qualifications of rationed share acquisition is a kind of scarce resource.Meanwhile,on condition of having the right of qualification of rationed share acqusition,listed company can raise a considerable amount of capital,even exceeding the capital of initial public offering.Compared with income of enforcing earnings management,cost is relatively small.6.According to analysis of factors influencing expectation cost,enhancing probability of being detected and punishment intensity can increase cost.So this paper provides a few effective measure to control earnings management.
Keywords/Search Tags:Listed Companies, Earnings Management, Institution Evolution, Return on equity
PDF Full Text Request
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