Both domestic and international research shows that accounting earning is of great importance in pricing in the stock market, which effects the decision of investors. Since earnings management is an universal fact at home and abroad, this paper aims to research whether earnings management impact the investors in the stock market and then evaluate the impact.This paper takes all of the listed companies between2004 and 2006 as the sample, establishes a number of linear regression models, and test the influence of the rate of stock return by the model's coefficients. The results show that the "Income Fixation" phenomenon still exist in China stock market. Discretionary accruals disclose more information of the stock price, and its explaining ability of stock price is stronger than the operating cash flow. Earnings management of listed companies will manipulate the shares and affect the investor's decisions. |