Research On Performance Evaluation Index Of China's Listing Companies

As the regulation of stock market becomes more normative, and the market is more efficient, the government and investors are increasingly concerned about companies' performances. Especially under the circumstance that listed companies in China have serious problems like earnings management and earnings manipulation, the performance evaluation of listed companies attracted unprecedented attention. After China entered WTO, being affected by the international economic environment, the environment that companies are facing has changed. Clearly, the traditional financial indicators as the core of performance evaluation system are no longer able to adapt to the requirements of modern corporate management and control, so a system of performance evaluation which closely integrated the company's key performance indicators with the strategic planning process must be built, and it must be congruent with the goal of companies'development which is oriented to the company's future and overall situation, and provide effective support to achieve the goal of maximizing companies'value and enhancing core competitiveness. In this context, on the basis of using foreign companies' performance evaluating indicators as reference, this paper aims to build the performance evaluation system for China's listed companies.With the methodology of case study, the basic writing ideas are as follows: Firstly, the related issues of performance evaluation of listed companies will be illustrated, mainly on the structure of China's listed companies'performance evaluation system. And then, take Hisense Electric Co. as an example, this paper analyzes each performance indicator of Hisense to evaluate its business conditions and results. In the eyes of traditional financial indicators system, Hisense are performing well in the aspects of solvency, asset management and profitability, and possesses certain market competitiveness. However, there are many limitations when using traditional financial indicators to evaluate the performance of enterprises. Moreover, in considering the comprehensive financial and non-financial indicators, such as labor cost and technological innovation, this paper integrates and modifies the indicators and finds a lot of potential problems and risks, then further analyzes and evaluates the actual sales abilities and competitiveness of Hisense.Secondly, starting from the case of Hisense Electric, this paper described the application of performance indicators in the listed companies, points out the problems of performance, evaluation in the listed companies in China, and puts forward sound proposals.Based on the above research logic, this paper includes five chapters, each part is briefly introduced as follows:Chapter one is the paper's introduction, which mainly introduces the background, the theoretical and practical values of the topic, and the literature review, both domestic and abroad.Chapter two is the illustration of basic theories. Firstly, the related issues of traditional performance evaluation of listed companies is introduced, which includes enterprise performance evaluation and performance index evaluation, the traditional financial performance measures system, the principles and methods of analyzing traditional financial performance indicators. Secondly, on the basis of former part, analying the current research of performance indicators for listed companies in China.Chapter three this paper tries to build the performance evaluation indicator system for China's listed companies. To be specific, this part includes establishing the performance evaluation indicator system of Chinese listed companies, exploring the performance evaluation indicator system, and presenting the actual state of the performance indicator system. Consists of advices to improve the companies' performance indicators, based on presenting the actual state of the performance indicator.Chapter four is the analysis of Hisense Electric's case. Using solvency indicators, operational capacity indicators, profitability indicators and other traditional financial indicators, the preliminary results of performance evaluation of Hisense Electric has shortcomings. At last, this part introduces the net cash flow analysis method to assess comprehensive financial and non-financial indicators, such as the production models, employee productivity, labor cost and technological innovation, then analyzes and evaluates the actual sales abilities and competitiveness of Hisense.Chapter five is the summary of the paper, which includes main conclusions, original ideas and research limitations.