Listing Supervision, Earnings Management And Supervision Improvement

After more than ten years of development,China's capital market has made great achievements,but compared with developed countries,there are still some problems.As an important role of the stock market,the listed company needs to absorb funds for public on this platform,regularly publish the company's operation to the regulatory authorities and the public,and accept the supervision and review of relevant departments.In order to make the capital market good and protect the interests of investors,regulatory authorities have designed many rules based on accounting data,the purpose is to prevent and punish listed companies' violations and improve the quality of listed companies.In recent years,the regulatory system has become increasingly strict in the continuous revision and updating,not only cleaned up the "zombie enterprises" in time,but also strengthened the delisting violation.However,the improvement is mainly aimed at violations,for listed companies that have not violation and regulatory penalties,has the regulatory system achieved its purpose of improving the quality of companies? Depth study of this issue has great practical significance and application value for discovering the loopholes in the current capital market supervision,improving the supervision policy and providing new ideas for regulatory improvement.Firstly,this paper used the literature research system to sort out the research results about the regulatory system and earnings management.Based on a solid grasp of relevant theoretical principles,the paper focuses on the companies that have not violation and regulatory penalties but have repeatedly conducted earnings management,and selects the Zhongbai Holdings Group Co.,Ltd.as the case research object.Starting with the phenomenon of "net profit is positive,net profit after deducting non-recurring gains and losses is negative" for three years,the case company analyzed in detail the means of earnings management,including the disposal of available-for-sale financial assets,the transfer of subsidiary equity,government grants,and asset-backed securitization.Combined with the performance indicators in the regulatory policy and the performance of the case company,it is concluded that the performance indicators are the root cause for earnings management.Select relevant data of the case company and Compostional Index of Shenzhen Stock Market from the wind database to obtain the cumulative abnormal return near the date of the annual report from 2015 to 2017 using the market adjustment model and observe the market reaction from the line chart.Combined with the profitability of this company in the past two years and the industry background,it shows that using earnings management to profit can not fundamentally change the current situation of the company,and even effect the efficiency of resource allocation.Based on above discussions,this paper believes that the regulatory system is unreasonable and has not played a role in improving the quality for the company that haven't violation and regulatory penalties.As a root cause to avoid regulatory penalties and carry out earnings management,it will hinder the development and hurt the company's fundamental value in the long run.This paper puts forward suggestions for the regulatory system to avoid single indicator impact judgment,such as add indicators that can reflect development potential and sustainability,classify companies by industry,and use dynamic supervision.Besides,the regulatory authorities should strengthen attention to the economic activities about the non-recurring gains and losses,so that the regulatory system can prevent and punish violations in the capital market,and improve the quality of listed companies.