Earnigns Quality Dynamic Measurement Of Chinese Electric Power Production Listed Company

Accounting income has very important decision value for investors and creditors;also it is the important basis of securities market regulation. The quality of the earning isvery meaningful for stakeholders in making good decisions, to avoid deceptive financialinformation and for regulating the Chinese security market. The electric powerproduction industry is the key sector of national economy of China, which contributesgreatly towards the stability, health and the sustainable development of the economy. Inaddition, the electric power production industry demonstrates some unique characteristics.Hence, it is very valuable to research the companies'earning qualities in this industry.Income quality should be disclosed qualitatively and quantitatively. It can bereflected by income reliability, cash indemnification, duration, growth and safety on thequalitative side and by income profitability on the quantitative side.Electric power industry has its own characteristics, on the analysis of the incomeand its influencing factors of electric power industry, I describe the cash indemnification,duration, growth, safety and income profitability of the quality of the earning the electricpower production industry.Using path PLS path modeling depicts accurate quantitative relations betweenobservable variables and latent variables. The unique advantage to use such method toreveal multi-factor dependence between variables provides an excellent analysis onquantitative quality of earning through grading the latent variables. This paperquantitatively described the earnings quality of 46 power production industry listedcompanies in 2005-2009, which used PLS path modeling. This analysis showed that theearnings quality of power production industry listed companies in 2005-2009 is stable.Therefore, PLS model can measure the earnings quality of power production industryeffectively.In order to construct dynamic measurement model of power production industry, thepaper established 5 times dynamic measurement model, which used latent growth modeland the scores of earnings quality of 46 electric power production industry listedcompanies in 2005-2009.The model display that the earnings quality of electric powerproduction industry accord with latent growth model, which characteristics of earningsquality.