The Study On Earnings Management In The Listed Companies

The problem of earnings management which was called"the game of market participants"has been for a long time in the West. For the recent years, this problem had caused wide attention in our country. The results of some empirical researches indicated that there were more actions of earnings management in the listed companies in China. Because accounting information is the object of earnings management and the excessive earnings management will distort such information. While it also has a close connection with the corporate governance. So by analyzing the causes of earnings management from the perspective of corporate governance, we can discuss how to standardize the action of earnings management reasonably and find out an effective monitoring mechanism. All of these will form a better corporate governance structure. Based on these reasons above, the thesis aims to do systematic theoretical analysis and empirical research on the relationship between corporate governance structure and earnings management of listed companies.The thesis explicates respectively the conceptions of earnings management and corporate governance as well as some relative theories. Combining with the actualities of the listed companies in China, it analyzes the deficiencies of the external and internal governance structure and the corresponding effects on earnings management. Then, beginning with the audit opinions, based on the samples picked from several listed companies whose audit reports had been pronounced to be nonstandard in 2006 and 2007, firstly the thesis makes use of the Modified Jones Model to estimate the degree of earnings management in the listed companies. Secondly, it establishes the multiple liner regression model, making the earnings management as dependent, the characteristic of board of directors and stock structure as independents. The empirical research toward the relationship between governance structure and earnings management is in progress with the logistic regression analysis. Last, some advises are given to improve corporate governance structure of listed companies with the hope to provide more effective ideas to standardize the action of earnings management.