Empirical Research On Earnings Management Of Listed Company In Real Estate Profession-Data Analysis Based On The Financial Reporting

Since the 20th century 80 years, earnings management has gradually become the focus of the domestic and foreign accounting theory area. Many papers have demonstrated the existence of earnings management issue of listed companies, but the study of this area on the Real Estate Company is rare. Comparing to the listed companies in the real estate industry and other industries, there are significant difference both in the operating characteristics and in terms of specific accounting. Although the government takes measures to regulate and control the building market, the estate price is still increasing in recent years. Therefore, this paper combines the real estate industry and the earnings management to research.The combination of the specification and empirical confirmation is adopted in this paper. First of all, the related theories of earnings management are reviewed based on the previous study by the experts in this area. Then, it is comprehensively reviewed in the development process of the real estate industry. Finally, 2007-2009 annual report and quarterly data of listed real estate companies in Shanghai Stock Exchange are collected and the conclusions are obtained by comparative analysis regression results of the modified Jones model (modelⅠ) and the newly created model (Model II). Specifically, it is to test the issue related earnings management in the real estate industry by the use of stepwise regression analysis and analyzing the direction and significance of regression coefficients. Moreover, the specific treatment recommendations are proposed in the end of the article.By empirical analysis, three conclusions are included as:1. The earnings management exists in both annual financial reports and interim financial reports in listed real estate companies. This phenomenon is most obvious in 2009.2. Listed real estate companies will do the opposite earnings adjustment to the annual financial report in the first quarter financial report after the annual financial censor.3. Model II is more suitable for estimating the non-operational accruals of the listed real estate companies in 2008'second and the fourth quarters and 2009'third quarter, that is to say, the listed real estate companies carry out earnings management more likely by stock., whereas, during other study times, the modelⅠis more suitable for the estimation of the earnings management of the listed real estate companies.Compared with the existing research, the innovations of this paper are as following:1. In the selection of the data, this article is based on the real estate industry which has more and more important effectiveness on the economic development and national stability as research object and analyzes the annual financial reports and interim financial reports after the implementation of new accounting standards (2007-2009). This is rarely mentioned in the previous papers researched on the listed real estate companies.2. In method, the whole research process is based on the Jones model, taking into account the characteristics of the real estate industry, added a new variable - stocks, thereby creating a new model, then, comparing the two model by the multiple linear regression analysis, a comprehensive study of the earnings management related the real estate industry after the enactment of new standards.Of course, there are also shortcomings in this paper, including the following two points:1. In this paper, the selection of subjects about the earnings management behavior of the listed real estate companies is only in general situations, the special items related the earnings management behavior being excluded.2. This paper demonstrates the existence of obvious earnings management behavior of the listed real estate companies and reveals the change features of earnings management, but the extent of earnings management regarding the listed real estate companies is needed to do further study.