The Empirical Research On The Influence Of Marketization Process And Ownership Structuer On Earnings Management

Earning management is increasingly becoming the focus of academia. It is a widerange of concepts, including two forms of moderate earnings management andexcessive earnings management and it also has a wide variety of influencing factors.We all known that moderate earnings management in the enterprise is a modest profitsmoothing behavior, not only does not harm sustainable development of enterprises,may also play an important role. Excessive earnings management has done greatharm to the reliability of accounting information, which may have violated the law.So we need to curb the profit adjustment behaviors. Securities market started late anddeveloped imperfect in our country. These shortcomings lead to the earningsmanagement one after another. Studying elements that affect the behavior of earningsmanagement we can grasp the business trends of the enterprise, curb their earningsmanagement behaviors and improve the quality of the earnings quality. With thecontinuous expansion of the reform and opening up, people pay more attention to thedevelopment of marketization. Market process and the ownership structure are thekey aspects of the enterprise. Only through the research of the relations betweenearnings management we can grasp more accurately factors to improve operationalefficiency, earnings quality of listed companies and to protect the interests ofinvestors. If we can do that we can achieve the purpose to regulate the securitiesmarket.This article selected the data of the2006-2008Shanghai and Shenzhen motherboardmanufacturing listed companies combining with the market index to study on the impact of earnings management by market process and the ownership structure. Weexplain the influence of the level of market-oriented as well as the ownershipstructure of listed companies. We can see that the extent of earnings management isdifferent in different market process. Under the same conditions, companies are morelikely to carry out earnings management in areas with a high degree ofmarket-oriented. In the lower degree of market-oriented areas, listed companies maymore likely restrain the earnings management behaviors as an alternative to theinvestor protection. In ownership structure, the degree of concentration of equity andownership property has an impact on company’s earnings management behaviors. Thehigher equity balance is, the better the restriction on earnings management behaviors.But the suitable degree is still inconclusive. In terms of equity nature, the ultimatecontrol of state-owned plays an opposite role in the operating efficiency of listedcompanies. The greater the proportion of state-owned shares, the enterprise morelikely carries out the earnings management behaviors. We believe that the absence ofowners may be an important factor in reducing the quality of listed companies. Theheavy losses phenomena verify the fact of the existence of earnings management.Facing with this phenomenon, we realized the importance of the study of earningsmanagement behaviors. Only knowing the precise effect of the excessive earningsmanagement behavior of a variety of factors can be able to better grasp the behaviorsof the adjustment of profits of the enterprise, and improve the rules and regulations ofthe securities market. We can promote the development of market-oriented. Thispaper studies the marketization process and the impact of ownership structure on theexcessive earnings management behaviors, hoping to get a correlation contributionfor earnings management. Based on the quantitative results, combining with the statusquo of China’s listed companies, we verify the assumptions.