Study On The Correlation Between Credit Rating And Earnings Management

After the change in 2008 of bond issuance system in China,that is from “quota examination and approval system” into “authorization”,credit rating industry began to attract more attention,also entered a period of rapid development,enterprise main body and its securities rating results play a more and more important role.China's domestic bond market in 2016 a total of 9.85 trillion companies credit bonds,bond financing amount far exceeds the amount of equity financing.The rapid development of China's bond market make relevant credit rating once again become a hot spot of research.Clear in the <Tentative Measures for corporate bonds issue>,issue bonds of listed companies to obtain a credit rating company subject as well as the new bond issues in current rating,which means the main body of enterprise credit rating to a certain extent determines the enterprise whether to issue bonds.And after issuing bonds coupon to ascertain the main credit rating,also depend on the company and the bond coupon rate determines the enterprise of high and low the cost of financing,in other words the body of the credit rating company has a great influence on the company's financing costs.And to a large extent credit rating is influenced by the accounting information,so the research of correlation between credit rating and earnings management is very necessary.This article selects the listed companies in our country with main body credit rating between 2010 and 2015 in the bond market as the research object,investigate the main body of the existing continuous rating company,study the correlation between credit rating and earnings management.Through the analysis on the linear regression model,separately from the two aspects of reality and accrued earnings management of the model is analyzed,it is concluded that the sample company credit rating in the rise of the previous year the company will conduct earnings management generally,and in two ways of accrued earnings management and real earnings management,companies are more likely to make real earnings management.If company has external demand at the same time,they will make more significant correlation between the two.At last,the credit rating of listed company is finally signed set dummy variable,said the company's credit rating adjustments motivation to dovish model test,the model test results are consistent with the empirical analysis results.According to the results of empirical analysis,put forward relevant policy recommendations:(1)the company level: continuous improvement of China's listed companies executive compensation assessment system and management mechanism of governance;(2)the macro level: improve the credit rating index system,unified institutions evaluation standard;perfecting the supervision mechanism of the capital market;specification and the system of accounting standards,especially the accounting information disclosure system.