Research On Motivation And Economic Consequences Of Enterprise Assets Disposal

Under the background of economic globalization,capital market complexity and corporation business activities diversities,enterprise asset disposal,a frequent occurrence of non-operating activity and involving large amounts,has become an integral part of the daily activities of enterprises.The impact of assets disposal gains and losses on the financial situation of enterprises has been becoming strengthened.Research on the motivation and economic consequences of enterprise assets disposal is helpful for improving the accounting treatment and reporting system of assets disposal gains and losses,broadening the research space of real earnings management theory,enriching the economic consequences of assets disposal,supplying reference evidence for market supervisors,standard setting department and CPA audit,and providing help for the users of financial statements to make more accurate decision-making,this thesis has very strong theoretical value and practical significance.Using normative study and empirical research methods,based on enterprise resource theory,prospect theory,agency theory and asymmetric information theory,drawing on the provisions of China Securities Regulatory Commission,Shanghai and the Shenzhen Stock Exchange,the paper analyzes and summarizes of basic issues related to the assets disposal.Based on the motivation and economic consequences of asset disposition,from the view of management intent,this paper focuses on the following three questions:(1)Based on non-opportunistic motivations(to speed up asset turnover and improve the efficiency of assets use;to obtain assets disposal gains and losses and change the profitability;or to increase cash flow and ease capital pressure,etc.),through the assets disposal to change the operating difficulties,management will comprehensively analyze the impact of macroeconomic,industry characteristics and internal factors on the asset disposal behavior in the process of assets disposal.The paper analyzes the path and mechanism of the effect of asset disposal on the asset allocation efficiency with the intermediary effect test.(2)Based on opportunistic motivation(profitability or smoothing profit),through the assets disposal gains and losses to adjust profits and the implementation of real earnings management behavior,this will have a great impact on the future performance and enterprise value.(3)No matter what kind of motivation,the occurrence of assets disposal and the disclosure of assets disposal gains and losses,will affect the stakeholders' judgment on the profitability of the company,resulting in the fluctuations in stock prices and returns.Due to the differences of asset types and holding purposes,this paper classifies the operating assets,long-term equity investment and financial assets in the process of the above research.Research on the motivations and economic consequences of assets disposal,will provide theoretical guidance and suggestions for the enterprise to disclose assets disposal gains and losses,reasonably allocate the enterprise assets,and restrain earnings management.Through the systematic research on the above problems,the main conclusions are drawn as following:(1)Based on prospect theory and enterprise resource theory,macro,industry and corporate financial situation will affect the assets disposal,there is a big difference in the degree of impact in the different stages of the enterprise life cycle,especially in the recession period.From the management intention to explore the motivation of enterprise assets disposal,based on the maximization of enterprise motivation,there are significant differences in disposal motivation with holding different asset classes.Based on the maximization of profitability,the firm will implement real earnings management with profitability and smoothing profit,it is likely to become true tools of earnings management,whether it disposes operating assets or long-term equity investment and financial assets.(2)This paper studies the path and mechanism of the effect of assets disposal on the efficiency of assets allocation by using the method of mediating variable effects,and draws the following conclusions: In the case of operating assets,due to assets disposal leads to the increase or decrease of the assets quantity,it has affected the efficiency of assets allocation by impacting the ability of assets operation,which plays a role of mediating effect.Assets disposal may lead to changes in cash flow,thereby affects cash holding level,and ultimately affects the efficiency of assets allocation,and the level of cash holdings plays a part role of mediating effect.Assets disposal gains and losses can directly affect the efficiency of assets allocation and also affect the persistence of earnings.However,the persistence of earnings does not affect the efficiency of assets allocation,while the persistence of earnings plays a role of masking effect.Therefore,the disposal of operating assets mainly affect the operational capacity and the level of cash holdings,and ultimately affect the efficiency of assets allocation.The disposal of long-term equity investment mainly affects the efficiency of assets allocation through the persistence of earnings,and the disposal of financial assets mainly affects the efficiency of assets allocation through the operating capacity and the persistence of earnings.Due to the different types of assets disposal,the path that affects the efficiency of assets allocation is quite different.(3)In order to achieve profitability,listed companies will dress up financial statements through the non-current assets disposal gains.To avoid large fluctuations in earnings or to avoid tax risks,listed company may dispose assets to obtain disposal losses to achieve a smooth profit.Based on the earnings management of turning around,the disposal of operating assets has a negative impact on future operating performance and enterprise value.The disposal of long-term equity investment has a negative impact on the future operating performance,and has no significant effect on the enterprise value.The disposal of financial assets has a negative impact on the short-term operating performance and has no significant effect on the enterprise value.On the basis of earnings management of smoothing down profit motivation,the disposal of operating assets has a positive impact on the future operating results,and has a negative impact on the enterprise value.The disposal of long-term equity investment and financial assets have no significant influence on future operating performance and enterprise value.From the results of the empirical test of the regulatory effect of the internal and external governance mechanism,the proportion of the largest shareholder and the proportion of the executives' holdings play an active role in restraining the real earnings management.External product market competition and analysts' tracking to a certain extent inhibit the occurrence of earnings management behavior.In general,both the internal and external governance mechanisms play a supervisory role in restraining turnround motivation,but the effect of external governance on the earnings management of the smoothing profit motivation is more obvious.(4)For whatever motivation,there is a significant value relevance between total assets disposal gains and losses as well as specific project and stock price and stock returns,assets disposal gains and losses due to the different way of disclosure,have different value relevance.In further analysis,the profit and loss situation has a moderating effect on the value relevance of assets disposal gains and losses.In the profit-making listed companies,the net assets per share is more relevant,while in the loss-making listed companies,investors will pay more attention to the information of assets disposal gains and losses.Because of the differences in industry characteristics and property rights,the value relevance of accounting information of assets disposal gains and losses also has a big difference.The main innovations of this paper are as following three aspects:First,this paper studies the path and mechanism of the effect of assets disposol on the efficiency of assets allocation by using a large sample data.In previous literature,the use of event research approach to the occurrence of major assets disposal of listed companies as a sample,studies the economic consequences of assets sales or divestiture,there is a certain subjectivity in the definition of major events,and the research object "assets" refers only to fixed assets and intangible assets.In order to overcome the shortcomings of previous research,this paper takes listed companies with assets disposal gains and losses as the research sample and adopts the research method of intermediary effect test,and draws a conclusion that the path of the effect on the efficiency of assets allocation is different with the different types of assets disposal.Second,construct a model to estimate the abnormal assets disposal gains and losses.This paper examines whether there is a real earnings management through assets disposal as a means under China's specific rules,and examines the role of corporate governance in curbing the real earnings management.It further studies the economic consequences of assets disposal based on earnings management motivation,and examines the impact of different asset classes on the operating performance and enterprise value in the next three years.Third,classifiedly study the value relevance of assets disposal and disclosure method.The results of this paper provide useful evidence for the improvement of China's accounting standards.The non-recurring gains and losses include recurring assets disposal gains and losses,which is helpful to improve the information quality of the "non-recurring gains and losses" project.