Research On Earnings Management Based On Equity Incentive Per- Formance Evaluation Indicators

Equity incentives are long-term incentives that give companies managers equity,options,or other forms of reward by setting certain performance appraisal conditions.Equity incentives can fully mobilize the enthusiasm of the company's management personnel and core employees,and solve the problem of inconsistent interests of the company under the separation of management rights and ownership.In 2005,China first promulgated the “Measures for the Administration of Equity Incentives for Listed Companies”,and in two successive revisions in 2016 and 2018,it means that the importance of equity incentives in China is increasing.China's current performance-based equity incentives adopt the “one-time grant,installment exercise or unlock” approach.During the assessment period,if the performance of the listed company meets the performance conditions specified in the equity incentive plan,the incentive object can be carried out within the specified time.Exercise rights,on the other hand,cannot exercise rights.It can be seen that the exercise performance conditions are the key factors affecting the realization of the equity incentive plan.However,in order to maximize its own interests,the management may adopt certain means to make the financial data of the company's current year meet the performance evaluation indicators.In recent years,the domestic securities market has been continuously improved,and people are paying more attention to the possible earnings management problems in the process of implementing equity incentives.This paper selects Yuheng Pharmaceutical as the research object.Through the theory and case study of the relationship between equity incentive and earnings management,it aims to identify whether the enterprise conducts earnings management and the possible earnings management for the performance evaluation indicators during the implementation of equity incentive period.Means provide ideas and methods for correctly identifying and preventing earnings management,effectively protecting company value,and improving the quality of accounting in-formation.It also helps to improve the equity incentive plan of listed companies,eliminate the negative effects of equity incentives,exert their true value,and improve the company.Governance.Firstly,the article sorts out the literature related to equity incentives,performance evaluation indicators and earnings management.On this basis,it defines the related concepts of equity incentives and earnings management,from principal-agent theory,incentive theory,and human capital theory.The rational economic man and other theories are the starting point.Taking the equity incentives of Yuheng Pharmaceutical as a case,through the combination of case and evidence,it is found that enterprises have a tendency to manage earnings for performance evaluation indicators during the implementation of equity incentives.Analyze the specific earnings management methods that enterprises may adopt,and propose corresponding improvement policies based on the research conclusions.Through the case and empirical research of Yuheng Pharmaceutical,this paper verifies the results of empirical research on equity incentives and earnings management,enriches the relevant literature in the field of equity incentives and earnings management,and provides solutions to the problem of earnings management under equity incentives.A certain reference.The article has the following shortcomings: First,due to information asymmetry,it is difficult to grasp more relevant information based on the public data of the companies in the industry and the industry in the research process.Some of the survey results are directly quoted.The company announced that it lacked a specific certification process.Second,the article only selects a single case for research,which is lacking in breadth,and the conclusions drawn cannot be applied to all listed companies.