The Analysis Of Local Government Subsidies And Earning Management Of Listed Corporation

In China's established Market economic system,under the touch of political responsibilities and the GDP only reassessment system,the government needs to regulate local economic development,in which the most direct means of government help is government subsidies.According to the statistic of government subsidies in recent years,it has been a great increase of the amount of government subsidies.Meanwhile,it combines with the earning management of listed corporation.The statistic of financial report shows S company gets lots of local government subsidies,which increases its profits.It can speculate that S corporation regulates business performance as well as government takes part in earning management through local government subsidies.Seen from the analysis in the case of S company,there is no actual help to improve business performance of listed corporation from local government subsidies,the listed corporation will become more dependent on local government and less competitive.It also produced obstacles to the securities market of our country to a certain extent,which is not good for creating a healthy market environment.As the market becoming more and more perfect,supervision policy becoming more and more meticulous,the local government subsidies for the listed company will also become more rational and reasonable.Under such background,analyzing the local government subsidies and the earning management of listed corporation is reasonable.According to the amount of local government subsidies and the financial statistic of the S company,this paper analyses through the interest needs of government and the development of listed corporation.The case study mainly analysis the effect of government subsidies for the earning management of the listed company.This study ensures the effectiveness of the data,which combines the particular situation and case study,to explore how to participate in the management of the corporate earnings.Based on this analysis,it provides more suggestion for the study of the local government subsidies and the earnings management behaviors.