Empirical Research Public Company Accounting Policy Change Effect On Earnings Management

Changes in accounting policies are the same corporate transactions or events on the accounting policies adopted from the original use another accounting policy behavior. Corporate accounting policies adopted in each accounting period and from one period should be consistent shall not be changed. But when the laws, administrative regulations or requirements of the national unified accounting system changes, or change will provide more reliable and relevant accounting information, the guidelines allow companies to change in accounting policies. Therefore, the change in accounting policy activities follows. Changes in accounting policies impact on corporate earnings management empirical accounting research is one of the core theory. Therefore, this article will examine the theoretical analysis and empirical methods combine to explore China’s listed companies use voluntary change in accounting policy for income smoothing, huge write-off, earnings turnaround management and other aspects of the theoretical and empirical issues, and thus for the listed companies in China’s securities market regulation provide theoretical support and policy recommendations.This thesis work is mainly divided into three parts from the level. In the first part includes chapters1and2. Chapter1describes the significance of this research, research status, research methods and analytical frameworks and this innovation. Chapter2of the paper defines the concept of correlation, and the change in accounting policy related to the theoretical basis for analysis, on the basis of analysis of the new accounting standards, changes in accounting policies impact on earnings management. The second part is the core part of this thesis, including Chapters3and4. By studying the samples and control samples descriptive analysis, nonparametric tests and regression methods tested our superiors earnings smoothing, huge write-off, generating losses of earnings management motivation. The results showed that Chinese listed companies in general, there is the use of a voluntary change in accounting income smoothing, huge losses offset and earnings management style and their income smoothing behavior factors include debt covenants, compensation contract, policy changes and the expected earnings before income deviation degree and profits rise; company huge reversal behavior of factors, including firm size, debt covenants and management changes; company earnings management behavior deficits factors include debt covenants. In the third part is in Chapter5, the research mainly in the second part of the paper summarizes the conclusions of empirical research based on the revelation, from improving our accounting system, securities market regulation start standardizing accounting policy changes proposed policy recommendations.