The Effects Of Managerial Expectation And Earning Management Incentives On Cost Stickiness

Cost habits as an important concept and content of cost and management accounting, mainly refers to the relationship of the total cost between a business volumes. The study of the relationship between changes in the cost of tack on the asymmetry between the cost and volume of business behavior not only helps companies prompted the "black box", but also for management accounting and financial accounting, crossover study to build a bridge between. Study abroad costs stickiness earlier, the country in recent years began to study the cost of sticky paper from the theory, based primarily on the cost of domestic and foreign insufficient viscous existing research, and combined with China’s actual conditions, exploration and research of Chinese listed Company managers are expected to affect earnings management incentives pipe cost stickiness, for management accounting, financial accounting and corporate governance disciplines have important theoretical and practical significance.The weakness of the existing literature at home and abroad:(1) Firstly, the domestic and foreign scholars for study cost habits are mostly concentrated in existence, motivation, impact, comparing costs between different industries, such as viscosity, the few articles related to the cost stickiness combination with other disciplines or fields Research.(2) Secondly, in the genesis of the domestic cost stickiness, the lack of subjective factors from the perspective of managers cost stickiness empirical research. And we know that the cost stickiness of generating and managers behavior is very close. In other countries, has been from the perspective of the manager is expected to cost stickiness effects on research, but also in the country rarely relevant theoretical and empirical articles.(3) A lot of evidence to suggest that the problem is the lead agency managers to achieve cost reduction and meet the key to avoiding the loss or decline in earnings to meet analysts’ forecasts. However, to avoid the cost stickiness of reducing the impact on the cost and performance decline losses have not yet been studied.In this paper, in order to supplement the existing literature, and management expects earnings management from the perspective of motivation, self-interested behavior primarily concerned with decisions made by managers, researchers due to the presence of earnings management motivation will make the managers to adjust resources and how it will affect the degree of cost stickiness. Then study the impact of different expected sales manager needs to tack on the cost, and finally consider the expected sales managers for different needs, to avoid losses, to avoid affecting the performance decline and the motivation to achieve analysts’ forecasts and the degree of cost stickiness on this basis, the proposed five basic assumptions, expanding the original model, the establishment of three basic models, the country’s1859listed companies as samples regression analysis. The conclusion that the relevant prospects for future research on the cost stickiness. The main framework of this paper is as follows:The first chapter, introducing. Mainly on the research background, theory and practical significance of the study, explained the main framework for research and to analyze the possible existence of innovation and lay the foundation for the study below.The second chapter, literature reviewing. From a cost stickiness, and management expects earnings management perspective to sort out relevant researches made by literature review.The third chapter, the theoretical basis and put forward hypotheses. Cost stickiness clear concepts and basic features introduced incentives to manage earnings, managers are expected to be defined, raised the cost of earnings management motivation and sticky combination of theoretical knowledge, managers and administrators are expected to cost stickiness expected earnings management motivation and cost stickiness five assumptions.(1) When decline in business, managers have incentives to manage earnings (earnings goals and to meet analyst forecasts) will make them more cost-cutting(2) When there is a surplus management motives deliberately resources managers will adjust the viscosity and thus weaken costs(3) The optimistic expectations of managers will strengthen cost stickiness. (4) Pessimism about the future managers will weaken corporate cost stickiness, and even anti-sticky cost behavior.(5) Comparing to the optimistic managers, managers of pessimism have a greater impact on costs sticky which have earnings management incentive.The fourth chapter, empirical research design. The main is to define and identify relevant variables and to establish a correlation model based research hypotheses have been proposed, as a foundation for empirical analysis below.The fifth chapter, the empirical analyzing of results. This paper mainly of1859listed companies from2003to2012as a sample study, the use of relevant data CSMAR database, and using STATA statistical software for the overall sample data analysis and regression analysis, the final correlation test, the use of empirical results test the hypothesis of rationality.The sixth chapter. The conclusions and limitations. This chapter is divided into three parts, the first part is the text of the summary of the relevant studies concluded that the second part of the proposed deficiencies exist in this study, the third part of the study of the future of business costs viscous prospected.This paper extends ABJ model and BCM models to study issues related to the following conclusions:(1) In the presence of earnings management incentive costs have an impact on the degree of stickiness. Through theoretical analysis, we know that due to agency problems, to avoid a loss, to avoid performance loss and motivation to reach analysts predict sales will decline when managers to accelerate the reduction of costs, and the cost of weakening sticky. We model the empirical findings, whether to meet earnings targets motive or reach analysis and forecasting of motivation, greater than0and at the0.01significance level, but also greater than0and at the0.01significance level, so we can conclude that in the sales decline, earnings management motives in the presence of managers will be more cost-cutting, and there are incentives to manage earnings will weaken costs viscous, sticky or even anti costs. So we have the enterprise cost management behavior, not only to consider the cost of management issues should also consider issues related to financial management, will combine the two.(2) management costs are expected to have an impact on the viscosity. We have different expectations of future managers into optimism and pessimism by theoretical analysis, is expected to produce a different effect on the cost of different tack when optimistic expectations, cost stickiness degree-will be greater than ABJ model, so you have to know optimistic managers will strengthen cost stickiness, while pessimism, cost stickiness degree-will be less than ABJ model, so that the cost of the pessimistic managers will weaken sticky, so we cost management in the enterprise, taking into account management who own behavioral factors, different attitudes to the future to make different decisions.(3) the managers expect that earnings management motivations impact study on the cost of the viscous, through modeling and test results, we checked out I y3-γ1will be less than|γ4—γ2|, so the impact on the cost of earnings management motivation sticky when strong pessimism assuming optimistic expectations when established. Considering the expectations for the future managers, there exists achieve profit targets and analysts predict the impact of motivation on the cost stickiness generated when the enterprise cost decision, managers as subjective factors, not only the expectations of its future importance, due to the agency the problem should also consider their self-interest to have a significant impact on the behavior of managers decisions, management decisions for the enterprise to become a reference and theoretical basis.This paper confirms the Chinese managers of listed companies are expected to impact on the cost of earnings management motivation sticky, but regardless of the theoretical and empirical point of view this is just the beginning, you need to follow relevant academics improve and complement the future costs will be sticky the outlook:(1) Firstly, in theory, managers are expected economic theory behind the existence of complex psychological analysis system managers, but this article only use the simplest basic theoretical definition and preliminary judgments. Subsequent scholars can learn relevant theories and research methods, and further enrich on "manager pessimism "and" managers optimistic expectations" theory, in order to study its effect on the cost of sticky.(2) Secondly, in empirical research, this paper only motivation for earnings management motives as three common variables associated costs viscous management research, however, earnings management motivation is complex and diverse, subsequent scholars can expand earnings management motivation the problem, especially in the special effects of the presence of earnings management motivation sticky cost study.Based on existing research and to draw on the results, try innovative research in the following areas:(1) verify the impact of earnings management motivation costs sticky. As the second chapter analyzes the cost of our country has not sticky and financial management issues combined analysis, the paper through specific earnings management motives, namely to avoid the loss, prevent a decline in performance and meet analysts’ forecasts as earnings management motivation cost impact and the extent of the impact viscosity were studied.(2) The managers in our expectations, motivations and cost analysis of earnings management tack together. Contrast ABJ model, using the extended BCM model, managers are expected not only to study the effects of cost stickiness, also studied under different conditions are expected to affect the motivation for earnings management costs incurred are different tack.Although this article for the first time to study the effects on the cost of earnings management motivation sticky and managers are expected to introduce further analysis and study, but due to the presence of subjective and objective factors, this paper has the following disadvantages:(1) In this paper, the main business income as an alternative to the traffic study variables, there are some limitations. Due to changes in the main business income covers double the price and yield changes, thus changing the main business income is not necessarily true reality of their business volume changes occur. Therefore, in future studies, such as if I get information about a study of internal production costs sticky, there will be a better representation.(2) The earnings management incentives, the paper just to avoid losses and decline in performance as well as analysts predict these three common motives for cost stickiness study, there are many special incentives to manage earnings in our country, so the conclusion has some limitations.