Is "Honest" Enterprise Really Credibility?

Honesty refers to sincerity and truth,which is the most popular quality of the our nation.Chinese credit culture has a long history," benevolence,righteousness,propriety,wisdom and honesty " is one of the Confucian culture,the " honesty " is an important content of " five kind of essential objective law ".That is to say,honesty is an important law of the normal operation of the society,which concerns not only our daily life,but also of great significance to the survival and development of the enterprise.In recent years,the government has paid more and more attention to the credit of enterprises.It not only promotes the credit rating of enterprises in the whole country,but also create a special website to publicize credit information of the enterprises.Honesty is becoming increasingly important for enterprises.Shandong Molong has been certified " credibility and integrity " enterprise by government for many times.It was also praised widely by stakeholders and partners.But it was investigated by the CARC in 2017,due to the performance " switch " and the " precision " reduction of major shareholders.The CARC considered the purpose of reduction is to avoid the loss and it is in fact " gain profit in risk ".However,Shandong Molong apologized to the public quickly,and explained the reduction of the large shareholders is to solve the enterprise capital turnover difficult situation,it was " timely assistance ".Each sticks to his argument.CARC and Shandong Molong's view seems reasonable equally.So refers to the " precision " reduction of Shandong Molong,whether " timely assistance " or " gain profit in risk ",whether the " honest " enterprise is really integrity,are worth exploring in depth.Based on the analysis of Shandong Molong financial,we found that the existence of earnings management motivation.And the degree of further research on Shandong Molong profit manipulation,the combined holdings of major shareholders,to carry out a large-scale earnings manipulation;in addition,we found that large shareholders use control advantage,adjust the time to delay information's disclosure,"bad news",so as to obtain greater benefits to large shareholders.All these behaviors deviate from the image of " honesty " advertised by enterprises in the past.They not only harmthe interests of investors seriously,but also chill enthusiasm and confidence of investors,which will cause immeasurable impact on effective allocation of resources in securities market.