Impact Of Real Earnings Management On Enterprise Value

The earnings quality of listed companies and enterprise value is getting more and more attention. Chinese and foreign earnings management behavior of listed companies is widespread, the consequences seriously affect the quality of accounting information, disturb the order of market economy, so the earnings management scholars as the important subject of accounting theory research. The research on earnings management has experienced accrued earnings management as the focus changes to real earnings management research focus.This paper studies the real earnings management in the short and long term impact on the enterprise value respectively. First, real earnings management motive, means and economic consequences of domestic and foreign literature were reviewed; then collate and summarize real earnings management influence on the enterprise value of literature; According to the economic consequences of real earnings management, drawing on previous research results, this paper analyzed the real earnings management’s influence on the enterprise value from the perspective of time dimension theoretically; The research comparatively analysis that handling business cash flow, control production costs and handling of discretionary costs in the short and long term impact on the enterprise value. According to the theoretical analysis, this paper put forward hypotheses and design multiple linear regression model.On the basis of theoretical analysis, using the data of China’s Shanghai and Shenzhen A-share listed companies from 2009 to 2013, we examined the real earnings management respectively in the short and long term influence on corporate value, and considering the influence of abnormal cash flow from operating activities of real earnings management, abnormal production cost and abnormal discretionary cost in the short and long term on the enterprise value. The results shows that real earnings management in the short and long term is significantly negative correlation with enterprise value, operating earnings levels will significantly reduce the value of enterprises. Real earnings management in the third year in a most serious negative impact on the enterprise value, and then change over time, affect weakening. Compared with short-term and long-term corporate value, found that real earnings management of enterprise in the long term makes enterprise value decreased obviously, that choosing long-term manipulation of the surplus will reduce enterprise value. Through analyzing the influence of the three common methods of real earnings management on enterprise value, we found that abnormal cash flow from operating activities and abnormal production costs were a significant negative correlation with the enterprise value in the long term, is not conducive to increasing the value of enterprise value. Manipulation of discretionary cost to the enterprise value in the short term is a significant positive correlation. It indicates that this will help improve the current enterprise value. In the short term, real earnings management mainly depends on the control of discretionary expenditure the purpose of the positive influence of the current enterprise value. In order to better ensure the preservation and appreciation of the value of the enterprise, to prevent real earnings management affect enterprise value in long-term. Regulators should establish a more comprehensive system of accounting information disclosure and improve the surplus information warning system early. While establishing the management of operating activities cash flow, production costs, and discretionary expenses.