A Case Study Of Earnings Management Based On Asset Impairment

Asset impairment in the actual accounting treatment has been an important impact,But also because of its operation is different and difficult to define often used to whitewash statements for earnings management,In particular,listed companies use the provision and reversal of impairment of assets to adjust the profits and reduce the quality of accounting information.It is easy for stakeholders to make mistakes.China's accounting policy of asset impairment has also experienced more than a decade,but it is still in the process of continuous improvement.In particular,the newly revised "Accounting Standard for Business Enterprises No.8-Impairment of Assets",which was revised by the Ministry of Finance in 2006,has been improved on the basis of international accounting standards and China's national conditions.One of the most important provisions is "long-term asset impairment once the provision,in the future fiscal year can not be turned back".To a certain extent,this provision to curb the use of assets impairment of listed companies for earnings management behavior.But it is more inclined to use short-term asset impairment to adjust the surplus,making the use of asset impairment for earnings management has shown some new features.The continuous improvement of accounting standards of enterprises and the management of earnings management are the dynamic development process of mutual restriction and mutual promotion.Based on the theoretical analysis of asset impairment provision and earnings management,this paper takes Qinhuangdao Tianye Tonglian Heavy Industry Co.,Ltd.as the research object.First of all,the article summarizes the company's 2010-2016 profit statement and asset impairment data.Secondly,the paper introduces the application of asset impairment in the enterprise.Finally,the three aspects of receivables,inventory and long-term assets are analyzed.It focuses on the large amount of impairment of assets that the company has calculated,turned back or resold in the past seven years.It may exist to avoid ST,smooth profit,exaggerate losses and other earnings management motives.Through the case study,it has found obvious problems in China's accounting standards,internal control of enterprises,external audits of the market,and professional accomplishment of personnel.Finally,the author also puts forward some suggestions on improving the application of asset impairment accounting for listed companies in China from the four aspects of accounting standards,market system,internal governance and external supervision.