Empirical Research Of Institutional Investors And Analysts Following On The Earnings Management

With the development of China’s securities market,institutional investors’ market shares continued to increase and they play an important role. Another emerging group of the rapid development of China’s capital market--securities analysts, who use their professional skills and gain an advantage securities information, transmission of information to investors because of its high professionalism and vocational training,the majority of investors often rely on their comments and suggestions. Institutional investors and securities analysts for the impact of capital market, making it an important part of our corporate governance external governance mechanisms. The rapid development in information technology today, the external forces of institutional investors, analysts and the media on the supervisory role of the enterprise are obvious,and their professional competence and access to information advantage makes them adept at detecting earnings management behavior of enterprises. Governance role of institutional investors and analysts has been a hot research, but the findings are not the same. From the perspective of external governance mechanism, investors and analysts the most influential institutions, research whether listed companies will have an impact in the choice of real earnings management and accrued earnings management.In this paper,2012-2014 A-share listed companies in the sample, research analysts and institutional investors holding listed companies choose to follow the impact of earnings management. It was found that the proportion of institutional investors and analysts to follow up the number of shares and earnings management companies there is a significant correlation, the higher the proportion of institutional investors holding,recessive manner degree weaker corporate earnings management;Analyst the more the number of follow-up, the way corporate earnings management is more of recessive. At the same time carrying out robustness tests, we found that compared to the state-owned holding companies, non-state-owned holding company of the impact of institutional investors on corporate earnings management is more significant. After controlling for certain endogeneity said main conclusions still supported.This paper put forward three suggestions from the corresponding institutional investors, analysts and corporate internal control information disclosure. This paper argues that institutional investors should be encouraged to strengthen cooperation and promote development among institutional investors, and promote information disclosure of listed companies and institutional strengthening personnel training analyst.Institutional investors and analysts to monitor effectively play the role.