Nationalized Business Governance Earnings Quality And Financial Restatement

In recent years, accounting fraud is not uncommon both in domestic and international capital markets. As influenza, the phenomenon of accounting fraud has seizures, repeatedly administrated and repeatedly made, it seems like chronic illness. Accounting fraud will not only disrupt the market economic order, resulting in micro-macro-control and decision-making mistakes, but also facilitate the economy criminal activities, making corruption, and even increasing social instability factors. Therefore, it is of great significance to address the issue of accounting fraud. One of the means of accounting fraud is financial restatement which is also called correction of accounting errors. It includes two contents: objective factors including wrong judgement of accountants and subjective factors in purpose of earnings management. This article mainly discusses financial restatement in purpose of earnings management, which is the restatement of financial statements for deliberate accounting error for specific purpose.For the accounting distortion problem, many accounting professions have pointed out the reasons of accounting distortion, such as, the temptation of economic interests, defect in the institutional arrangements, cost-benefit imbalance, lack of moral integrity...In my opinion, the source of the accounting information distortion is the shortcomings of corporate governance, including irrational equity structure, high proportion of state-owned shares, low proportion of outstanding shares, the board of directors controlled by the internal control of board by insiders, the failure of the board of supervisory. Based on the earnings surplus phenomenon led by the financial restatement, we want to make a research of the corporate governance of state-owned.This paper analyzes problems mainly with empirical analysis, auxiliarily with normative analysis, and effectively combines the two methods. To build the framework of the study, it will follow the technology roadmap of literature review, theoretical analysis, policy recommendations and the empirical testing. This paper is divided into 5 chapters, as follows:The first chapter is the introduction chapter, mainly introducing the source of the topics, home and abroad research study, the significance of this article, and the features and innovation. This chapter has made the direction of research, outlined the research framework of this article. The second chapter is the theoretical analysis, mainly introducing the theory of state-owned enterprise governance, earnings quality and financial restatement and the relationship among of them. State-owned enterprise governance and financial restatement are linked by the earnings quality. As the core of this paper, the third chapter is the empirical part. Firstly it chooses state-owned listed companies restating financial data during 2003-2007 as a sample, then secondly makes matching pair for the sample, and lastly uses the Logistic regression model to identify the assumption. The forth Chapter is the empirical conclusions and policy recommendations. Considering the actual situation of China's listed companies, it analyzes the correlation of state-owned enterprise governance and financial restatement. On the basis of the analysis, I put forward some policy recommendations for reference to improve China's state-owned listed company corporate governance, with a view to control the occurrence of malicious financial restatement by the adoption of corporate governance mechanisms and governance structure. The fifth chapter summarizes the results of research, as well as the limitations and follow-up study. It provides the direction of deepening and expanding for further research.This paper links the corporate governance of state-owned enterprises and the financial restatement with earnings quality as a bridge to study the corporate governance of state-owned enterprises from the perspective of the financial restatement.Its contributions are as follows:Proved that China's state-owned enterprise's financial restatement has relationship with the proportion of state-owned shares, asset-liability ratio, the Board of Supervisors and the Board of Auditors. It puts forward suggestions to improve the corporate governance structure. And it points that the shareholders and the Board did not play its due role in the China's state-owned enterprises, and it points out the direction for the corporate governance of state-owned.Because the limitation of author's academic knowledge and some objective restriction, this paper has some shortcomings on theoretic base foundation, a comprehensive study of the prerequisite, settlement of research samples, width of research area and solidity of research method, which need improving.