Nature Of Property Rights And ST Company Turnound Earings Management Behavior

Property rights as the institutional basis of the enterprise,affect the corporate governance structure of the enterprise,management target,management decision-making,internal supervision and external supervision,etc.,these factors in a certain extent affect the earnings management behavior of the enterprise.Part of ST companies in China if it continuing losses in three years,and unable to quickly boost main business profitability in the short term,it will face the delisting processing.In that,the listed company usually managing the surplus,also named earnings management,than make up the deficits and get surpluses.Otherwise,the related literature about earnings management find that the state-owned enterprises and non-state-owned enterprises use obvious different way to make it.May be it it is associated with property rights.In this paper,the earnings management will be defined,the property rights will be defined by the ultimate property rights theory.And it introduces the nature of property rights and the degree of earnings management,the surplus management means.And selecting two similar enterprises to study,that got a negative profit in the same year,turning a positive profit in the same year,the business scope is the same,all in machinery manufacturing industry.The study found that different in terms of Asset restructuring,changes in accounting estimates,and related party transactions.And it will be explained by the property rights:state-owned enterprises occupy more resources than non-state-owned enterprises;actual control of the intervention of state-owned enterprises is stronger than non-state-owned enterprises;State-owned enterprises are real supervision is weak.In conclusion,state-owned enterprises tend to use low cost way,as adjust the accounting policy,mergers and reorganization to boost profits,replace asset with connected once.And during the period of the financial distress,non-state-owned enterprises obtain less support,tend to sell assets,do connected transaction to make it turnover.