Ownership Structure?Internal Control Quality And Real Earnings Management

In recent years,there have occurred a lot of financial fraud cases in domestic and foreign,people began to doubt whether the financial data provided by enterprises is true and reliable.The financial quality affects the long-term development of the enterprise,but also determines the investors' investment behavior.From the existing research and most financial fraud cases we can see that through the earnings management is a common choice that manipulate accounting earnings for many enterprises,and the enterprise that use real earnings management to manipulate profits is also increasing.The reason why the enterprise carries out earnings management is to show the good financial information to the stakeholders.When the enterprise's normal business activities can not guarantee the realization of high-quality accounting earnings,the enterprise will surplus management for the purpose of beautifying financial information.Studies have already shown that internal control quality and ownership structure are important factors to earnings management.In theory,the quality of internal control and the rationality of ownership structure can play a very good effect to earnings management from the process management and top-level design.The improvement and effective implementation of the internal control system not only can inhibit the earnings management,improving the quality of earnings,but also can reduce the business risk of enterprises and safeguard the long-term interests of enterprises.Similarly,the rationality of the ownership structure can also form an effective control and supervision to the shareholders and management,reducing the possibility of earnings management.According to this analysis,this paper studies the relationship between the quality of internal control and the management of real earnings,the ownership structure and the management of real earnings.On this basis,we research the relationship between the three under the adjustment of the ownership structure.This paper selects all the A shares listed companies in China's capital market from 2011 to 2015 as the research samples,first of all,we define the relevant concepts and analyse the relevant theory,then make empirical analysis to the sample data using the statistical software.The results are as follows(1)internal control quality and real earnings management clearly shows a negative correlation.(2)ownership concentration and real earnings management was U-shaped relationship,that is excessive decentralization of equity and excessive concentration of equity all will increase the possibility of earnings management,and when the relative concentration of equity,the shareholders can balance and strengthen supervise to management,thereby reducing the level of earnings management.(3)The negative correlation between the quality of internal control and real earnings management is relatively significant in non-state-owned enterprises,and this relationship is not so significant in state-owned enterprises.(4)The addition of equity concentration reduces the negative correlation between internal control quality and real earnings management.From the above research results,we can see that the quality of internal control and ownership structure play an important role in reducing earnings management.Finally,based on the results,this paper puts forward some suggestions on how to improve the internal control system and the corporate governance structure,reducing the possible surplus of earnings management,hoping to provide relevant theoretical reference for academic and some reference for the further construction of the internal control system and the further optimization of the ownership structure of listed companies.