| With the development of economy,in order to occupy more market share and open up new profit growth points,listed companies in China have carried out mergers and acquisitions one after another,and the capital market has set off a wave of mergers and acquisitions.For film and television industry enterprises,in order to compete for scarce resources(Star IP),they usually choose to acquire "star shareholder company" at a high premium.High premium M&A will bring huge goodwill and lay hidden dangers for the future development of enterprises.In 2018,listed companies on the GEM collectively accrued impairment,triggering a "goodwill thunderstorm",which caused widespread concern about goodwill impairment from all walks of life.In recent years,the attention of all circles on goodwill impairment has weakened,but it is still important for enterprises and capital markets to strengthen the relevant research on the management’s use of goodwill impairment for earnings management.Based on this background,This article selects Huayi Brothers’ acquisition of Dongyang Meila as a case study.Firstly,Huayi Brothers occupies a certain position in the film and television industry,and secondly,its performance commitment signed when acquiring Dongyang Meila has expired in 2020.The research window is more complete and more typical.This paper adopts the methods of literature analysis,case analysis and event study.First of all,consult relevant domestic and foreign literature,summarize and sort out the current research situation,and select signal transmission,principal-agent,criterion elasticity and tunnel behavior theory to provide solid theoretical support for the following analysis.Secondly,the case analysis method was used to analyze Huayi Brothers’ earnings management by using goodwill impairment.The study found that Huayi Brothers had the behavior of using goodwill impairment for earnings management.The main motivation was for managers to maintain their own interests and for enterprises to avoid losses and withdraw from the market.The main means are to delay the timing of goodwill impairment provision and adjust the amount of goodwill impairment provision.The behavior of enterprises using goodwill impairment for earnings management has brought negative impacts to the enterprise,including repeatedly causing regulatory accountability,leading to damage to the enterprise’s reputation,exacerbating the decline in business performance,and stock prices.Once again,explore the opportunities for Huayi Brothers to use goodwill impairment as a earnings management tool and propose corresponding governance strategies.The results indicate that the large amount of goodwill generated by high premium mergers and acquisitions in the film and television industry and the current methods used for measuring goodwill have given management sufficient discretion.At the same time,the imperfect goodwill impairment disclosure system has also increased the space for Huayi Brothers to conduct earnings management.In response to the above reasons,this article proposes suggestions from three aspects: strict control of high premium mergers and acquisitions by enterprises,compression of standard flexibility space,and improvement of information disclosure systems.Finally,the conclusion and inspiration for all parties in the market are drawn,hoping to identify and prevent the behavior of listed companies using goodwill impairment for earnings management,thereby promoting the healthy development of enterprises and the capital market. |
