Research On The Influence Of The Motivitation Of Avoding Loss On Cost Stickiness

To strengthen the ability of control enterprise cost is an important method to improve economic efficiency of enterprises, and the important weapon of improving their own competitiveness, to make themselves stand on the fierce market competition. Control and management of the cost is an important field in theory. As a part of the main research content in cost accounting, cost behavior mainly tells the relationship between sales and cost. Traditional cost model apposed that the relationship of cost and sales is symmetry. But with the development of theory, scholars found when sales rising,the amplitude of cost increase is greater than the amplitude of cost reduction, when the number of sales fell the same,namely cost and sales is asymmetric, and named it the cost sticky. For the existence of the cost sticky broke the foundation position of the traditional cost behavior theory in the management accounting, forcing us to study in-depth and meticulous to enrich cost sticky research.Different cost decisions of managers lead to cost stickiness. So regulators themselves are an important factors affecting cost stickiness. From the angle of management decision-making potential motive, we begin to research cost stickiness. This study firstly reviews the costs theory at home and abroad which lays a theoretical foundation for the research of this article. Previous theoretical research proves that cost sticky plays a significant role in manufacturing corporation, so we choose manufacturing corporation as samples. This study choose the listed company’s financial data, these companies appear to the public later in 2007,because our country implement a new accounting standards in 2007.We use Excel 2007 and stata 12 for data processing and regression, then we get the empirical analysis results. The following is a summary of our results. First, financial data of the manufacturing listed companies in China exist significant cost stickiness. Second when sales drop, sales managers tend to cut costs of sales, so the cost of sales have more stickiness. When the managers have motivation to avoid losses, we can still get the same conclusion.Third when motivation is to avoid losses, sales managers will be more active to cut costs. Four, the decision may reduce the viscosity of cost. In the role of two phase motivations to avoid loss, the company will have higher stickiness. Five,whether managers are optimistic or pessimistic about the future of sales, when managers have motivation to avoid losses, the manager will accelerate to cut costs, these decisions lead to lower cost stickiness, namely the degree of viscosity increased. The last, when managers are optimistic about the future, avoiding losses incentives exist a bigger impact on cost of sticky. The innovation of article is that from the perspective of earnings management motivation, we explore how different costs and the consecutive period of motivations affect cost stickiness,which is helpful for managers to realize cost stickiness, and continuously improve enterprise performance.