Empirical Study On Accruals Method Of Listed Companies In The Steel

Accounting earnings management is concerned. Earnings data can provide useful information to professionals through the company's future earnings forecast that the change of direction; investors can learn from the company's earnings data to evaluate the company's basic situation; company information can be measured by accounting earnings performance, business owners as incentive for operators to carry out. Accrual accounting surplus generated by the basic premise of the accounting basis and accounting calculations may be distrust, some scholars and analysts who measure of the actual profitability of the business make more earnings data reliability questioned.Scholars come to the surplus stock of rules, assuming there is business continuity, all the surplus during the period of its existence, not changes because of the accounting procedures, these changes do not affect under the premise of the cash flows can. Mainly accounting methods, changes in accounting procedures, general changes in corporate earnings in the number of different size distribution of the different periods, but no way to change the company confirmed in its measured during the existence of all the surplus quantity. Managers under the accruals profits from negative reflects the characteristics of surplus profits, they aim to achieve a particular accounting method to use to change the accounting surplus stock, accounting measurement method can adjust the accruals profits in this way they can to increase the number of current accounting earnings, future earnings for the period thus reducing. you should fully understand the accrued profits, more importantly, the manipulation of accruals include accruals recognition analysis carefully, and then make the appropriate investment decisions.Another reason is that earnings management to smooth the annual corporate profit management. They get a good corporate image in order to prevent the ups and downs of corporate performance. Another reason is to satisfy the private interests of corporate management of accounting earnings management. Also in charge of financing to meet the Securities Act restrictions have to gloss over the financial data to deceive the public, the end result is to undermine the effectiveness of the market, so the potential misallocation of resources, reduce resource use efficiency. So of earnings management can not only provide some predictability to the information the user signals, but also for regulators and investors to provide valuable reference information to use to avoid falling into the trap.China's iron and steel industry as a pillar industry in national economic development plays an important role in the process. Steel are used in real estate, automobile, shipbuilding, machinery manufacturing, household appliances and other manufacturing industries, the industrial chain length and breadth of covers is self-evident. But in recent years, steel prices continue to rise and fall like the tides, their results are disclosed as the statements as true and reliable out of it. Almost all studies have revealed the reality:there earnings management of listed companies. Iron and steel enterprises will perform earnings management, accruals in the handling and manipulation of accruals of non-empirical accounting research can discover the relationship? This is the text to be prepared to discuss.Such research must have two critical steps, first, managers need to identify earnings management motivation, and then need to determine when there is no earnings management, should have normal accruals (non-discretionary accruals profits). A common approach is to first find a possible sub-samples of earnings management, and then test their abnormal accruals (or discretionary accruals profits) whether the motivation for earnings management and speculation based on prior assumptions consistent. Currently, testing earnings management more effective Jones family model, estimated profit of non-discretionary accruals measure of earnings management became an important method, and it is currently on the Earnings Management Research in Western literature the most widely used method. As the manipulation of abstract concepts of accruals, the existence of internal accruals and the control of the extent to which its management manipulated the amount of accrued profits or profit allocated in different periods, which itself only as the management of insider became clear, and as it is impossible for an outsider researchers completely truthful information. However, due to non-discretionary accruals during the distribution of profit and its great extent Therefore, the researchers can calculate non-discretionary accruals to reverse squeeze profits calculated accruals profits. The current level of earnings management in China and its influencing factors remains to be depth.Separation of total accruals advantage of the main problems:its gross surplus can be in front of more integrated and more business means reflect the accrual manipulation, small ways, such as deferred revenue recognition, cost capitalization; large areas such as accounting estimates and changes in accounting methods, this method is generally measured from the level of earnings management, and its clear-measurement method is also relatively simple, while the study was the special requirements of small enterprises, which makes its conclusion of the study also has good comparability and universality. Total accruals in the study of separation, more scholars use methods described above Jones family, mainly in the overall targeted a large sample of listed companies, the lack of these studies is to ignore the differences between the industry and therefore the study results authenticity and practicality has aroused much controversy. Therefore, empirical research, consider the accounting system and the actual operating characteristics of enterprises, the study of certain amendments to the model. In this paper, based on previous studies, the study sample to the steel industry specific listed companies, the profit accrued separation with the idea of increase or decrease the Jones model explanatory variables to our steel industry from 2003 to 2009 listing of sample test profits of the two handling measurement model, and compare the applicability of the two models, the regression results found that the manipulation of the sample of earnings management company profits degree of change.Significance of Research:This article on the Jones model is modified as necessary by industry sub-sample year to return to discover the impact of earnings management in this industry, an important factor. Second, the accrual method of handling the appropriate improvements to enhance this approach is feasible and effective.Logical thought this article: After necessary explaining in the preface, I review of the theory of earnings management and research, and then focus on a detailed description of methods of measuring earnings management-one of accruals separation. On this basis, two measurement models are applied. Finally, the two sample data regression model, respectively, according to a comprehensive comparative analysis of statistics and found that modelⅡlisted companies in the steel industry, has more explanatory power.Paper consists of five major parts:PartⅠ:Introduction to the paper. The background motivation is presented to explain the significance of research to introduce this approach to the study.PartⅡ:Earnings Management and accruals related theories. First, the theory of earnings management is introduced, and then talk about the inventory accounting standards on earnings management, the last of the accounting methods of earnings management accruals made separation comb.PartⅢ:Based on the above, leads to this article using the accrual method of profit measurement reference model to construct a new model.PartⅣ:An Empirical Analysis. On the same sample using the two models to estimate the least square method, then, based on empirical test results are analyzed and reviewed.Part V, conclusions, shortcomings and prospects.This article and other works that may be of little different:1, corresponding to the total profit metric model I do a little improvement. At the same time with the modified Jones model regression testing, visual inventory found that the change in the new model, the total accruals 40% impact than other explanatory variables.2, sub-sector analysis points to the year. The selection of the sample is only limited to the steel industry to avoid the interference caused by differences in the industry. And sample statistics for testing every year for seven years and found that in 2007 the maximum level of earnings manipulation.