Research On Enterprise Surplus Management And The Characteristics Of Refinancing Cash Dividend Under Semi-Compulsory Dividend Policy

Since the formal establishment of China’s securities market at the end of 1990,the dividend situation of listed companies has not been optimistic,especially cash dividends.In the early days of its establishment,listed companies had the lowest degree of feedback,basically "heavy financing and light dividends",actively raising money in the securities market,and rarely distributing profits to investors.This collective phenomenon has greatly damaged the confidence of investors in China’s securities market,especially the confidence of some investors who take cash dividends as the main profit expectation,prompting more investors to choose stock price difference as the source of expected profits.China’s Securities Regulatory Commission has also noticed this market phenomenon.It has promulgated a series of relevant policies to encourage dividends of listed companies since 2001,in an effort to maintain the sustainable development of listed companies and protect the interests of investors,especially small and medium-sized investors.These policies are known as "semi-compulsory dividend policies".The main logic of the semi-mandatory dividend policy is to link the inevitable refinancing behavior of listed companies with corporate dividends,and to incentivize listed companies to dividends by satisfying certain dividend conditions if listed companies want to refinance.The most important policy changes in the semi-mandatory dividend policy were in 2004,2006,2008 and 2013.The 2004 regulations for the first time linked corporate dividends to refinancing eligibility,in an attempt to increase enterprises’ consideration of dividend policies.The 2006 scheme established a minimum dividend rate of 20 percent linked to eligibility for refinancing.The 2008 decision raised the minimum dividend to 30 percent and limited the form of dividends to cash.The 2013 guidelines provide a new angle for encouraging corporate dividends,that is,to propose differentiated dividends to the boards of listed companies,but this differentiation criterion was only improved in the 2022 revision.There are many studies on dividend policy by scholars at home and abroad,and Chinese scholars have contributed many high-value research results to China’s semi-compulsory dividend policy after 2006.Most scholars affirm the positive role of the semi-compulsory dividend policy in China’s securities market,but at the same time,some scholars have doubts about the long-term impact of the policy.They believe that there is a certain regulatory paradox in this policy,which tends to make enterprises with refinancing needs more financial pressure,thereby increasing their incentive to engage in negative earnings management.Starting from the semi-mandatory dividend policy,this paper explores the earnings management behavior of specific enterprises under its influence and the characteristics of cash dividends related to refinancing.Taking single case analysis as the main research method and sampling survey as the secondary research method,this paper selects Yangnong Chemical Industry to analyze whether its surplus management behavior is related to refinancing,the correlation between its two refinancing and cash dividend characteristics in 2007 and 2009,and the implementation effect of semi-compulsory dividend policy in this specific case.Based on summarizing the research results of predecessors in the academic field,this paper analyzes the specific case of Yangnong Chemical Industry and draws the following conclusions:(1)The logical paradox of the semi-mandatory dividend policy will increase the motivation of enterprises to manage negative earnings,and the existence of semi-mandatory dividends may weaken the inhibitory effect of cash dividends on the degree of enterprise earnings management;(2)Listed companies are prone to "pandering" behavior for the semi-compulsory dividend policy,that is,meeting the cash dividend threshold when there is a need for refinancing,and not being constrained by the policy at all when there is no demand;(3)The semi-compulsory dividend policy has the limitation of incentive effect,it is only limited to a few years when the enterprise has refinancing needs;(4)If you want to revise the semi-compulsory dividend policy,you can consider it from three aspects: one is to increase the negative dividend consequences of "dividend difficult" enterprises,the other is to improve the information transmission system of the securities market,and the third is the differentiated treatment of the policies.