| In recent years,with the gradual relaxation of the national merger and acquisition policy and the continuous improvement of the merger and acquisition market environment,more and more companies have chosen to enhance the company’s strength through mergers and acquisitions.In the wave of mergers and acquisitions,many companies embarked on the road of continuous mergers and acquisitions in order to achieve the rapid expansion of the company’s scale.At the same time,the number and amount of enterprises that signed Valuation Adjustment Mechanisms also reached a peak with the wave of mergers and acquisitions.As a derivative financial instrument,the mechanism can alleviate the risks caused by the information asymmetry between the two parties to a certain extent,and can also give the merged party certain incentives.After the acquirer completes the continuous merger and acquisition,the earnings quality will change to some extent,so does the Valuation Adjustment Mechanism affect the earnings quality in the continuous merger and acquisition? If so,how does the Valuation Adjustment Mechanism affect the quality of earnings? This thesis discusses it in depth from this perspective.This thesis uses the method of case study to take the continuous merger and acquisition of Guoci Materials Company as an example to analyze the impact of its Valuation Adjustment Mechanism on earnings quality under continuous merger and acquisition.This article mainly analyzes from three perspectives: performance reward,performance compensation and performance commitment of the Valuation Adjustment Mechanism.First of all,in terms of performance rewards,the study found that the Valuation Adjustment Mechanism with reward consideration has a better incentive effect on the acquired party,also helps to ensure the stability of the acquired party’s core personnel and management team,and the unequal incentive mechanism of "punishment is more important than reward" in the incentive consideration clause is also conducive to better maintaining the stability of the acquirer’s governance structure,and has a positive impact on the quality of the acquirer’s earnings quality.Secondly,in terms of performance compensation,the study found that the share compensation method is compared with cash compensation,the incentive effect of the method on the acquired party is more obvious.At the same time,the Valuation Adjustment Mechanism with all cash compensation methods is also easy to cause the acquired party to carry out earnings management,which is not conducive to improving the earnings quality of the acquirer.Finally,in terms of performance commitment,the study found that it was appropriately extended performance commitment years can improve the earnings quality of the acquirer,and the high or low growth rate of performance commitment will have a negative impact on the earnings quality.In addition,due to the particularity of continuous mergers and acquisitions,if the acquirer can continue to digest and absorb the experience of mergers and acquisitions in the past,and optimize and improve the deficiencies in the Valuation Adjustment Mechanism in time,it will have a positive impact on the acquirer’s earnings quality.To sum up,this thesis makes a comprehensive analysis of this issue from three perspectives of performance reward,performance compensation and performance commitment,and draws a conclusion: the Valuation Adjustment Mechanism signed by both parties of merger and acquisition will have an impact on the earnings quality of the acquirer from the above three aspects.In addition,if the acquirer can continue to learn the previous experience of merger and acquisition under continuous merger and acquisition,it is also conducive to improving the acquirer’s earnings quality.Finally,based on results of the above study,suggestions are made for the acquirer to sign the Valuation Adjustment Mechanism in the process of continuous mergers and acquisitions,hoping that the study of this thesis can help enterprises to better improve their earnings quality in the process of continuous mergers and acquisitions. |
