An Empirical Study On The Relationship Between Non-monetary Assets Transaction And Earnings Management

China issued the fist non-monetary assets transaction accounting standard to meet the needs and regulate the exchange of non-monetary assets business in 1999, and revised it twice in 2001 and 2006. Three times changes of the standard not only restrict enterprises using the exchange of non-monetary assets for earnings management, but also left new spaces to enterprises for earnings management, and the No. 7 standards of 2006 produced more profound effects on earnings management. Company through this exchanges for earnings management, which do harms for the minority shareholders and creditors, disturbing the order of the securities market.First of all, the selected topic background and significance was first given in the paper, then combing summarizes researches of domestic and overseas scholars, at the same time in order to facilitate research, defined the concepts of this paper involved in the study and introduces the related theories. Secondly, on the basis of theoretical analysis, pointing out that the implementation of the this standards gives the companies new space to use the non-monetary assets transaction for earnings management after combined with the changes between No. 7 standards of 2006 and the older. From the points of the relationship between the exchange of non-monetary and earnings management, and whether the company’s solvency and profitability have an impact on it, six hypotheses were put forward in this paper. In order to verify this hypotheses, some factors are chosen as the the research variables to study the 64 companies which make non-monetary assets transaction in Shanghai A stock market from 2011 to 2013. At the same time, in accordance with the relevant standards, 64 companies are chosen for the paired samples. The modified Jones model is used to measure the quality of the surplus of the company, and then using descriptive statistics and Wilcoxon rank test and regression analysis method to study the relationship between the exchange of non-monetary assets and earnings management. The results showed that: from 2011 to 2013 in Shanghai A stock market, the companies which exchange the non-monetary assets use the exchange of non-monetary assets for earnings management. This companies have the characteristics of a high asset-liability ratio, poor profitability, and consecutive losses, so we can according to the rate of asset-liability, the CFO and whether continuous loss indicator of the comppany to determine whether a company using non-monetary assets transaction for earnings management. The age of the company, total assets turnover ratio, earnings per share have no significant effect on company whether to use the exchange of non-monetary assets for earnings management. Finally, combining with the conclusion of this article and our country’s reality, some suggestions are given from the aspects of how to further perfect the relevant standards, the focus of financial analysis and the external supervision.