Research On The Relationship Between Linguistic Features Of Management Discussion And Analysis And Future Performance Of Enterprises

In recent years,the ups and downs of capital markets have led to strong demand for timely and accurate information of listed companies.China Securities Regulatory Commission requires the listed companies to disclose the information of enterprise performance to the market as the medium through which the listed company management can deliver reliable information to investors.‘Management Discussion and Analysis' is one of the most important information the listed companies' management disclosured in annual report,including the interpretation of both current situation and trend of the future development,which plays an important role in the decision making of the investors.master of business decision making It has a certain influence on the decision of investors.There is obvious information asymmetry between investors and Management bacause Management is the controller of enterprise operation decision.And management will actively convey corporate value signals to investors.However,the complexity of the Chinese language makes the management inclining to impress the non-financial information in the ‘Management Discussion and Analysis'.That management whitewash the text language expression will mislead the investor's decision and even damage the effectiveness of the market.Based on the theory of Communication Action,this research puts forward four dimensions of the effectiveness of the Management Discussion and Analysis linguistic features: understandability,authenticity,sincerity and correctness.Through literature review and systematic analysis,this paper puts forward five measurement indicators of language features: Readability,Selfserving-attribution,Self-reference,Depth and Density.Through the selection of 200 ‘Management Discussion and Analysis' text of China Growth Enterprise Market in 2014 and 2015 as samples,Return on Equal as financial indicators,using text mining technology to measure the relevance and regularity between linguistic characteristics and future financial performance.The main findings are as follows:(1)Readability,Selfserving-attribution,Depth and Density have a significant impact on future financial performance,and Readability,Depth and Density are significantly positively correlated with future financial performance,Selfserving-attribution is negatively correlated with future financial performance;(2)Management layer does not use Self-reference to carry on the subjective statement of the language,which is not related to the future financial performance.(3)Management does not use the linguistic features of a certain dimension,but use a combination of various expressions to transmit enterprise value signals together;(4)The combination of language features is not a constant.In different accounting periods,the management layer uses different linguistic features to carry out the transmission of enterprise value signals according to the different situation faced by the enterprise.Finally,this paper summarizes the disciplinarian of enterprise value signaling and puts forward suggestions for management information disclosure.