Research Based On The Earnings Management Of Chinese Listed Companies Under The MBO Perspective

The Management Buy-Out originated in the United States in the1970s, as one way of equity restructuring, clear property rights to establish and improve the incentive and restraint mechanisms. Management Buy-Out has played a positive role to incentive management, to reduce agency costs, and to improve the management of the enterprise conditions. In the1990s MBO was introduced into our country enterprise and put into practice, the target basically is the state-owned enterprise or a state-controlled listed companies, as a kind of the way of China’s state-owned enterprises reform of property rights to explore. However, from the introduction of MBO on, theorists and businessmen argue for this acquisition means never stopped, supporters believe that the reform of property rights for the state-owned enterprises or state-controlled listed companies, is an effective way to improve the management incentive system. While opponents argue that managers use their own advantages embezzlement of state assets in the acquisition process, and against the interests of minority shareholders and other issues.Then we choose58MBO enterprises from the beginning of2000to the end of2009as a sample to study, and put forward two hypotheses:1) the year before MBO management make the accounting treatment of reduced accrued income;2) when the MBO is finished, management will increase income accounting. Then we design four models for inspection, but testing results can not support the hypothesis. In this paper the may limitations of the study, and then provide some suggestions in financing, supervision, and pricing, and give the MBO reasonable guidelines to ensure that our MBO is more mature and healthy.This paper includes five parts, from ask questions, analyze them and then solve them, here is the arrangement:The first part is the introduction part of the paper to introduce the background of management buyouts of listed companies in China. Although the rise of management buyouts as a new means of mergers and acquisitions, can effectively reduce agency costs, incentive management and improve operational efficiency. But in China, China’s special market institutions, the relevant laws are not perfect, so with more Chinese characteristics. So the development of MBO in China is not easy, the too low purchase price, the narrow channels of financing,"internal control" and other reasons, make the earnings management possible, but whether the earnings management behavior is exist, that is what we need to prove in the following part.The second part is a review of literature as part of the paper. The scholars from China and from abroad to respectively on earnings management theory, management buy-outs, a review of earnings management in the MBO process, this reference value for future research in this article.The third part is the preparation before the empirical analysis, mainly including the theoretical basis of earnings management and MBO; collection of the sample data and descriptive statistics; put forward two assumptions that in the year before MBO management will try to reduce accounting and in that one year after MBO management will make the increase of income accrued accounting treatment; four model designed for the assumption.The fourth part is the empirical analysis section of the papers. According to four model we put forward at the third part--the total accrued profit model, the accrued total profit of random model, considering scale and the industry factor model, the extensive Jones model--we test analysis the four models.The fifth part is the thesis conclusions. Through an empirical study on the analysis result, and put forward conclusion the shortcomings in them, provide some suggestions for earning management in the progress of MBO, such as expand the financing channels, strengthen the supervision of the MBO, the proper pricing.