| In China’s established Market economic system, under the touch of political responsibilities and performance evaluation system, the government needs to regulate local economic development through the " invisible hand",take part in the operating activities through the "invisible hand", in which the most direct means of government help is government subsidies. For the local government, the immediate motivation is to increase local revenue, to solve the employment problem for local residents, increasing political livelihood investments; the indirect motive is to have relationship with our local government performance evaluation system, under the GDP-only re-assessment system, the local government will come to support the listed companies through the financial means to solve the problem of local employment through the development of related industries, and promote local economic growth, strengthen local competitiveness."Rational economic man" hypothesis provides a theoretical basis for the motivation of local government Incumbent officials. The central government just to draw general fiscal policies while the local government have direct control of the enterprise, and implement the policies. According to flush iFind statistics, from the derivation of the listed company’s annual published statistics, the data of government subsidies is40.035billion yuan in2010,the data of2013is47.048billion yuan. In2012, a total of1646received government subsidies totaling56.4billion yuan. Obviously, the amount of government subsidies enjoys a growing trend over the years. So, in this context, the research of government subsidy motivation of listed companies as well as earnings management of listed companies, has a strong practical significance.This paper argues that the government subsidies have two sides, the negative effects in supporting the enterprise and maintaining the economy cannot be ignored. Seen from the analysis in the case of Sanan Optoelectronics, the listed company obtaining large a lot of subsidies from the government improved their performance, but it is only a temporary solution, on the contrary it produced obstacles to the securities market of our country to a certain extent. The revenue of Local government is belonging to the public resource, the government subsidies for specific companies in use of public resource, but there is no competitiveness increasing substantially in a certain period of time,they will become dependent on the government, and need more and more subsidies to improve company performance, which is not good for creating a healthy market environment. As the market becoming more and more perfect, supervision policy becoming more and more meticulous, the government subsidies for the listed company will also become more and more rational and reasonable.The study is divided into six parts. The first part is an introduction, including the background, purpose and significance, research ideas and frameworks, research methods.The second part is review of the literature, analyzing and summarizing from the existing research literatures respectively. The third part is government subsidies theory and earnings management analysis, including the direct meaning and indirect meaning of government subsidies, the concept of earnings management and theoretical support;The fourth part is statistical analysis of government subsidies involved in earnings management of listed companies, including the overall analysis of a sample of nearly four years, analysis of divided industry, analysis of regional subsidies and analysis of industry with various corporate nature; The fifth part is the case study analysis, mainly selecting three optical analysis as a case of government subsidies in Sanan Optoelectronics the role of profit as well as the effect of government subsidies for the implementation of the listed company analysis with theoretical conclusions above; The sixth part is conclusions and recommendations of the study,and limitations of research.This study has some practical significance. First, new topics, selecting timeliness of the data; research process focusing on the combination of theory and practice, using a typical case of government subsidies to further explore how to participate in the management of the reasons for corporate earnings; Secondly, based on certain principles of economics, etc. theoretical analysis, focusing on research how government subsidies helps listed companies stop losses and earnings management motivation, provides more evidence for the study of earnings management behavior and methods. The shortcomings of this papers is:the government subsidies are diversed. There is some subsidies which are difficult to quantify and not directly reflected in financial statements, statistical data and the actual may exist deviation. |
