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The Research Of Influence Of Institutional Investors Heterogeneity On Earnings Management

Posted on:2017-07-10Degree:MasterType:Thesis
Country:ChinaCandidate:L L YuFull Text:PDF
GTID:2349330485464804Subject:Accounting
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It is the most basic responsibility for listed companies to disclosure true and fair financial statements. However, a series of financial fraud case, so we had to face earnings management of listed companies. Studies have shown that China's listed companies generally implement earnings management behavior. From the internal point of view, this is mainly due to the prevalence of Chinese Listed Companies "dominance" phenomenon, often leading to override internal controls over major shareholders, major shareholders is easy to implement earnings management go against the interests of small shareholders. Generally considered a sound corporate governance mechanism and a high level of corporate governance can significantly reduce the occurrence of earnings management. One of the most important changes of institutional investors as capital markets in recent decades, society has been placed the task of improving corporate governance by the end of 2012, raised funds, pension funds, QFII and other professional institutional investors hold the stock market value of tradable A the proportion of 17.4%. Thus, institutional investors have become a powerful force in China's capital market. Previous studies demonstrated that institutional investors due to the different in terms of size of the stake, holding time, etc., will result in different effects on earnings management.Institutional investors reasonably accurately divided, and further explore the purpose of different types of institutional investors in the company's earnings management of the impact of this article. China's capital market as regulators increasingly stringent, the listed companies use accruals to achieve adjusted surplus space has been very limited. This reality shows that companies will take real activity is more difficult to see through to adjusted earnings. In this paper, the perspective on the real earnings management, more in line with the reality of our situation, but also make the results more accurate. This paper reviews the motivation of earnings management, institutional investors in corporate governance, and institutional investors research earnings management and institutional investors heterogeneity and earnings management. After combing the relevant research literature, select the most representative of the shareholding of institutional investors heterogeneity characteristics as the division basis for this article. And review of relevant legal documents, 5% and 30% of institutional investors as a dividing point between lower stake(less than 5%), medium stake(more than 5% but less than 30%) and the equity ratio is high(greater than 30%) of three types.Based on the above, the use of descriptive statistics, correlation analysis and regression analysis of the study tested the hypothesis. And through robust test, to some extent, improved the accuracy of the findings. Conclusions of this study showed that:(1) When the total shareholding of less than 5% of institutional investors, although it is not involved in the daily management of listed companies, but it can be taken in conjunction with other minority shareholders to sell the stock or ways to encourage listed companies reduce the level of earnings management;(2) when the total proportion of institutional investors holding more than 5% but less than 30%, to the presence of directors of listed companies, involved in the daily management of the company. But it did not play a sound corporate governance, the role of the level of earnings management;(3) when the total shareholding greater than 30%, significantly stimulated the occurrence of earnings management behavior. Finally, institutional investors can not effectively improve the level of corporate governance constraints, and put forward relevant policy recommendations.
Keywords/Search Tags:institutional investors, institutional investors heterogeneity, corporate governance, earnings management
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