Research On Porformance Commitment Risk Management Of Juli Culture & Meishengyuan

With the continuous development of our country’s capital market,a series of enterprise merger and reorganization policies have been issued one after another,for widening their own industrial chain,the realization of enterprise upgrading and transformation.In M & a activities,more and more M & a parties use performance commitment agreement as a tool to regulate M & a business and avoid M & A risks,to a large extent,to curb the M & A to assess the value of the manipulation.In order to make the best use of valuation adjustment,the acquirer must analyze and judge the risks that performance commitment may bring to itself in M & A.In the process of M & A,the acquirer is often in a relatively inferior position of information,so from the perspective of the acquirer,this paper studies the various risks that may be encountered in the application of performance commitment agreement mechanism in the process of M & A,it is of theoretical and practical value to help the M & A to identify the risks effectively and take countermeasures to prevent and evade the risks.Firstly,this paper combs the relevant literature about risk identification and control of performance commitment,and finds that performance commitment is a commonly used tool in M & A,secondly,the paper expounds the related concepts and theoretical basis of performance commitment.Thirdly,based on the latest material of typical cases,from the perspective of M & A,applying the relevant theoretical foundations to explore the risks that exist before,during and after the performance commitment period,and using scientific tools to analyse and evaluate the causes of these risks in detail,finally,according to the identified risk of M & A,the corresponding countermeasures are put forward.This paper concludes that: first,the expected benefits of performance commitment agreement in the process of M & A are always associated with the possible risks.Performance commitment has different risks in different stages of M & A: in the early stage of performance commitment,the risk of performance goal setting and the risk of asset overvaluation;Performance commitment period mainly exists fraud risk,integration risk and earnings management risk;performance commitment period mainly exists goodwill impairment risk,compensation risk and litigation risk.Secondly,fuzzy analytic hierarchy process(FAHP)is used to evaluate the risk,and it is found that the risk in the early and late period of performance commitment is bigger than that in the middle period.In the early stage of performance commitment,the risk of overvaluation of the underlying assets is the highest,followed by the risk of over-setting the target performance of the acquired party.In the middle stage of performance commitment implementation,the risk of fraud is the highest,the risk of earnings management and integration is the second,the risk of goodwill impairment is the biggest in the later period of performance commitment,the risk of recovery and litigation are the second.Third,in order to guard against risks,the M & a party should select the target enterprises in the advantageous industries,value the target enterprises with scientific methods and set appropriate performance targets for them,it is necessary to carry out real-time monitoring to prevent them from achieving their performance targets by illegal means and causing losses to the acquirers.