The Earnings Management Means' Relationship Of Listed Companies To Turn Into Profit

In order to regulate the behavior of the listed companies and protect the interests of investors, at present the regulate department take the company profit as the only standard to decide if delist the companies. The system decide that the companies who have successive two loss years will be named ST before their company code. Besides, the ST companies' quoted price have a fluctuation range limitation of 5% everyday. If the ST companies cannot turn loss into profit in the third, they will even face the danger of being delisted. Under the background, the accounting profit become the only target to prevent the listed companies from being punished or delisted. The loss companies have to use any possible approaches to turn loss into profit. There have been many domestic and foreign literature that attested the fact that loss companies would try every means to change the loss situation, but this kind of research mostly focus on the proof of whether or when the earnings management happen. As to the approaches of earnings management, especially the the relationship the different measures there have no enough research up to today. From this view, this article try to reveal the relationship of different earnings management measures at different phases of changing loss situation.This article use the listed companies who had negative income and eventually make a profit before being delisted between 2007 and 2010 as sample companies, observe the action of the sample companies when they use different ways to making a profit to stop the loss at different phases. Through the empirical research, this article find the loss companies use both discretional accounting profit and sales arrangement to change the loss during different phases, and the two measures have substitutional relationship. The audit department and the related investors have to pay attention to the substitutional relationship of the two profit-making measures, and promote the ability of distinguishing accounting information when they evaluate the listed companies.This paper use both theoretical and empirical methods to research the earnings management measures at different phases. This paper is divided into the following four parts:The first part is introduction, this part briefly expound the background of this paper and the theoretical and practical significance of this research, it present the beneficial exploration and conclusion in this field and briefly presented the contents of the research methods and innovations of this paper; The second part if the theoretical analysis. This part introduce the common ways of earnings management and their possible relationship; The third part is the empirical part. At first, it proved the discretional accounting profit and sales arrangement are both being used in the earnings management through mean respectively inspection and logistic regression method, and then proved their alternative relationship through a regression model and the results have stability; The last part is conclusion, it evaluate this paper objectively and at last propose some policy suggestions according to the conclusion.The innovation points of this paper is to classify earnings management measures into two parts:discretional accounting accrual profit and sales management,according to their different influence bring to the companies. Besides, this paper use quantitative method instead of qualitative method to measure the sales management level. And it try to reveal the relationship between different earnings management approaches from a total different new view in order to propose some beneficial policy suggestion.