Factors Influencing Earnings Persistence Of Chinese Agricultural Listed Companies

Earnings persistence is a measure of earnings quality.Persistent earnings have higher decision usefulness in company valuation.In this paper,we take 2007-2016 years of Shanghai and Shenzhen Agricultural and forestry agricultural and fishery listed companies as samples.First,the principal component analysis method is used to construct the earnings persistence index system.Through this system,the overall surplus status of the agricultural listed companies in China is graded,the sample grouping test is used by the hierarchical evaluation method,and the net interest rate index of assets is used.The two evaluation is to verify that the score of the system can reflect the earnings persistence of agricultural listed companies to a certain extent.Then,the factors that may affect the earnings persistence of the listed companies are classified:the financial market financial index and the corporate governance factor,the two aspects and the earnings persistence in the system are gradually replaced to carry out the correlation test,and the two rights separation,the first largest shareholder shareholding ratio,the second major shareholders of the company.To the tenth major shareholders,the proportion of institutional shareholding,the scale of the company,the capital density,the core profit ratio of free cash flow,the ratio of government subsidy and tax return,and set up three control variables,such as financial leverage,asset liability ratio and profit and loss condition.After the study,we draw the following conclusions:two right separation,capital density,free cash flow and earnings persistence have a significant negative correlation,which shows that the control and ownership of the actual controller can promote the sustainability of earnings,and excessive depreciation and amortization will affect the sustainability of earnings.When the company's free cash flow is too large,especially when the core profit is too high,it will have a negative impact on the earnings persistence of the listed agricultural companies.The company size has a significant positive effect on the sustainability of the earnings.It shows that the ability to resist the risk after the expansion of the company scale can increase the sustainability of the earnings;the scale and capital of the company can be increased.The two variables of this density are all related to asset factors.One positive and one counter correlation shows that the expansion of the scale of the enterprise is not a simple increase in assets,but also the conversion ability of the assets,and the two variables have a constraint on each other;the effect of government subsidies on the earnings persistence of the listed agricultural companies is lagging behind.The effect of government subsidies on the earnings persistence of agricultural listed companies is lagging.The results of the group study according to the type of enterprise and the nature of the actual controller show that the influence degree of government subsidies in different types of agricultural listed companies is not consistent.The conclusions of this paper make up for the lack of specific research on Agricultural Listed Companies in China's earnings persistence research.At the same time,the conclusions also show that the index selection and the related influence factors in the earnings persistence scoring system will be related to the whole industry and other lines because of its own characteristics.There is a difference between industries.The evaluation of original single index may be insufficient for earning sustainability evaluation of agricultural listed companies.It will provide new ideas for further research on earnings persistence of agricultural listed companies.