Research On The Evaluation Of Earnings Quality Of The Electric Listed Companies

The quality of accounting information of listed companies has been paid much attention by such stakeholder as investors, creditors, government departments and etc. As the core component of information, the earnings information is more important. The earnings'quality of listed companies becomes common concern to domestic and abroad. If the listed companies provide low quality of earnings information, it will certainly mislead the users of financial statement. They may misapprehend the actual situation and make wrong decisions which bring losses to them. How can we really distinguish the profitability and earnings potential of listed companies, and help the users to make the right decision who dependent on the financial reports? This requires the evaluation and analysis of earnings quality of listed companies. In this paper, we will take the electric listed companies as the research object and discuss the analysis method of the earnings quality of the listed companies.Firstly, this paper compares the relevant regulations of accounting information quality in FASB, IASC and Chinese Accounting Standards, then analyses the characteristics and influencing factors of the earning information which is subject to accounting information.Secondly, based on previous research, this paper tries constructing an earnings quality evaluation system of the electric listed companies by the way of selecting many financial indexes which reflect the cash earnings of security, neutrality, growth and stability. Then this paper chooses the factor analysis which could carry out the objective weight. It is hoped that investors and other stakeholder could make more all-round evaluation on of the earnings quality of the electric listed companies.Finally, this paper makes analysis and evaluation of earnings quality by using the assessment model for the electric listed companies form 2004 to 2006. The results shows that the earnings quality of electric listed companies from 2004 to 2006 has a marked polarization; but the trend had been improving, that the EPS ranking is inconsistent with the EQI ranking of electric listed companies, that the leading stocks were stable and top in comprehensive evaluation, and that inner of electric listed companies appeared board differentiated.