Study On The Causes And Effects Of "Face Changing" In The Performance Forecast Of TianCheng Holdings

The management earnings forecast is important in information disclosure.Since 1998 China's Earnings Forecast System has been continuously improved,and now it plays an important role in supervising management earnings forecast.With the development of our country's stock market,the investors prefer to refer to earnings forecast before making decisions.However,in reality,due to the motivation of profit-seeking,the phenomenon of earnings forecast “face changing” often occurs.The managers of listed companies often seek private profits by manipulating release time and the content of earnings forecast,resulting in the management earnings forecast not only don't work but destroy the stock market.Therefore,it is necessary to study that phenomenon deeply.We ought to find out the reasons of earnings forecast “face changing”,for that to enrich the theory of signal transmission and protect the benefits of investors.Through the Normative Research Method and Case Study Method,this paper studies earnings forecast “face changing” about TianCheng Holdings for 2016 annual.By reviewing the earnings forecast,regulations from stock market as well as the punishment,this paper explores various reasons which led to TianCheng Holdings earnings forecast “face changing”.This paper firstly studys the motivation and effect of earnings forecast,then studys “face changing”,and finally put forward some ideas for the current problems.The conclusion of this study: the earnings forecast “face changing” of TianCheng Holdings not only caused insider trading,but also caused great economic losses to investors,which undermined the stability of stock market.Through researching,this paper finds that earnings manipulation and information disclosure violations are the immediate cause of TianCheng's Holdings earnings forecast “face changing”.In addition,the lack of external control power of company is also bad for earnings forecast.For example,the imperfect Earnings Forecast System,the lack of punishment from government,and the few interaction between management earnings forecast and analyst's earnings forecast are not good for high quality earnings forecast.