Equity Pledge,Nature Of Property Right And Earnings Management

Under the growing trend of Chinese capital market,due to the high liquidity and high transparency of stocks,the pledge business of equity has gradually gained the favor of financial institutions and companies.According to the Wind data,as of December 31,98.3% of listed companies in the A-share market have equity pledges,and the total market value of pledge stocks reached 5.5 trillion.Among the individual stocks involved in equity pledge,the pledge rate of 95 individual stocks exceeded 50%,and the pledge rate of 11 individual stocks exceeded 70%.The scale of equity pledge has significantly expanded,and the pledge rate of equity has also risen sharply.While affirming that the equity pledge business serves as a financial support for listed companies,it must also recognize the risks that this business brings.The greatest risk of equity pledge comes from the drop in stock price.The increase in the pledge rate of equity will further aggravate this risk.To avoid this risk,major shareholders and management are very likely to use the management of earnings to increase the stock price.The nature of property rights is a unique attribute of an enterprise.The performance of different types of property rights in the behavior of equity pledges and the impact on earnings management may be different.Based on this,this paper mainly studies the relationship among the equity pledge,nature of property rights and earnings management.This paper takes the data research of Shanghai and Shenzhen A-shares from 2014 to 2016 as a sample.Build a model through literature review and theoretical analysis,the model test empirically examines the effects of equity pledge and property right properties on the management of earnings surplus and actual earnings management respectively,and the effect of equity pledge on real earnings management from the perspective of property rights,and further explored the effect of equity pledge on various manipulation methods of real earnings management from the perspective of property rights.The study found that:(1)The increase in the equity pledge rate of listed companies will significantly increase the level of enterprise's accrued earnings management and real earnings management;(2)In the case of equity pledges,state-owned listed companies will tend to have a real surplus compared to private enterprises.Management,and will also tend to adopt three kinds of real earnings management manipulative means: production control,sales manipulation and cost manipulation;(3)the state-owned property rights of listed companies will weaken the positive impact of the increase in equity pledge rate on real earnings management,The relationship between the two plays a counter-regulatory role,and the nature of the state-owned property rights will also change the impact of the increase in the pledge rate of equity on the manipulation of the three types of real-state earnings management.This article has enriched the scope of equity pledge research and tried to further explore the agency issues behind equity pledges,which has played a role in enlightening the integrity of equity pledges and the protection of stakeholders.Finally,according to the conclusions of the study,the proposal of controlling the pledge rate of equity is proposed.This paper believes that the company should strengthen the internal control system and optimize the company's shareholding structure,give full play to the supervisory role of the board of supervisors,the pledge needs to improve its own risk control,and the supervision department needs to be sound.Pledge of equity related laws and regulations.Through the above-mentioned supervision in various aspects,enterprises are encouraged to make proper use of equity pledge financing to enable the company to achieve long-term health and development.