An Empirical Study On The Ownership Structure And Earnings' Quality Of The Private Listed Companies

Earnings quality is a very important aspect of the evaluation of corporate financial health.Poor earnings quality is often associate with financial fraud cases. From the Enron case,World Com to other scandals such as Xinjiang Delong Group non-operation,this series of financial cheating cases make the problem of accounting earnings quality increasingly prominent.After analyzing the major factors affecting accounting earnings,we find that the controlling shareholder plays an important role in the earnings management which can affect earnings quality.Therefore,it is important to define earnings quality's meaning correctly,measure earnings qualityappropriately and analyze the relationship between ownership structure and earnings quality.This paper regards 449 listed companies of stock markets among 2005-2006 year as samples and carries on empirical study of the relationship between ownership structure and earnings quality,trying to find the correlation between them and to give advertises on the optimization of the proposed shareholding structure.This article first carry out a review of the literature,and then research on the ownership structure and earnings quality in theory which is the theoretical basis for this article.And then this paper carried out a descriptive statistical analysis on samples and a correlation analysis.We use the surpluses to return model to study the relationship between these two.Empirical results show that:In the direct listed firm of private,there is a not significant correlation between the largest proportion of shareholding and the earnings quality."∩"-shaped relationship between the largest shareholding ratio and earnings quality is found in the indirect listed companies of private;The ratio of other shareholders can improve the quality of earnings,but not in the direct listed company of private;In addition,this paper shows a higher proportion of the corporate shares can benefit the quality of earnings in the direct listed company of private but not significant in the direct listed company of private.