The Split Share Structure Reform And Capital Market Motivation Of Earnings Management Research

Earnings management has been in-depth study in the field of economics and accounting at home and abroad . A lot of research results show that there is a strong motivation on earnings management in most listed companies . Earnings management is very prevalent in China's capital market. In the "dual option" structure, the major shareholders are generally non-tradable shareholders. There is no direct link between major shareholders and the company's secondary market price. So, major shareholders will not affect the stock price through earnings management and there is no capital market earnings management motivation .The reform on the split share structure led to the link between the interests of major shareholders and the stock prices. Shareholder's behavior patterns will change with the change of the interests. Capital market motivation maybe driven on earnings management .There are three main motivation on earnings management in the overseas research: capital market motivation,contract motivation and political cost motivation. In this paper , we main research capital market motivation on earnings management in the background of the split-share reform. Capital market motivation on earnings management is that capital investors and financial analysts use accounting information during the decision of stock price , so, managers have an incentive on manipulation of accounting earnings to influence short-term stock price. In this paper, we study the"size not"reduction in earnings management after the split-share reform. We use empirical analysis and normative analysis as our research methods. Investigate whether there is capital market motivation on earnings management in our capital marketIn this paper, we first of all define the meaning of the earnings management and analyze the system foundation and economics consequences on the capital market earnings management motivation in our country. The ,we use case research and empirical research as our methods .We analysis a total of 1112 non-financial sector listing by 2003 in china A-share market through Jones model Our target is to study the"size not"reduction listed company's character of earnings management. The result shows that ,after the split-share reform, positive earnings management of listed companies increased significantly. Compared with no reduction companies ,"size not"reduction companies showed positive earnings management in before four financial years. All results show that, after the split-share reform, there is capital market motivation on earnings management in our capital market. Based on the studies, we propose appropriate regulatory measures to protect the legitimate interests of minority shareholders...