A Case Study On Earnings Management Of *ST Biology Company During Getting Rid Of Delisting Risk

The establishment of the securities market has made great contributions to China's economic development in the past 30 years,but there are still imperfections in supervision,which provides conditions for listed companies to manage their earnings.ST listed companies,in particular,will get rid of delisting risk warning through earnings management because they can not achieve a turnaround in a short time,and this has gradually evolved from a case to a general phenomenon.This action will affect the acceptance and use of the company's disclosure information by financial users,and it is not conducive to the healthy development of the capital market in the long run.In view of this,this paper has important practical and theoretical significance for ST listed companies to get rid of delisting risk warning through earnings management.Based on the above background,this paper mainly uses case analysis to research and select *ST biology company as a research sample.Firstly,it identifies and measures the earnings management in the process of getting rid of delisting risk warning,then analyses the motivation and means of earnings management,and finally evaluates the results of earnings management.The research results show that(1)*ST biology company is prone to abuse of earnings management in order to avoid delisting and financing motives.(2)ST listed companies utilize the imperfections of relevant systems and information disclosure to make reasonable and skillful changes in accounting estimates,greatly reduce the ratio of bad debts,through the replacement of "garbage" and "gold",selling fixed assets to related parties at special time points and debt restructuring in disguised financing to get rid of the risk of delisting warning.(3)Although the company uses earnings management to get rid of the risk of delisting warning,it is only a short-sighted approach,because it will hide dangers for its future development.Finally,according to the research results,this paper puts forward some countermeasures and suggestions for the governance of earnings management behavior of ST listed companies,such as reducing the free choice space of accounting estimates of ST listed companies,strengthening information disclosure in the process of ST listed companies getting rid of the risk of delisting warning,rationally planning delisting system,improving delisting index system.This paper is divided into four parts.The first part is the introduction of the article.It expounds the research background,research significance,research ideas and research methods,and sorts out the relevant literature on the motives,means and economic consequences of earnings management.The second part is the case introduction of the article,which mainly introduces the basic situation of *ST biology company and the process of getting rid of delisting risk warning.The third part is the case analysis.Firstly,it identifies and measures the earnings management behavior of *ST biology company.Then it analyzes its motives for earnings management,and what kind of earnings management methods are used under such motives.Finally,the results of earnings management are evaluated.The fourth part is the countermeasures and suggestions for the article.