The Empirical Research About The Influence On The Earnings Management Produced By Company Features

Earnings management of listed companies can bring great effect to the effectiveness of securities markets and interests of minority investors directly. Earnings management behavior exists, with the result that the share price of listed companies can not correctly reflect the performance of the company. The huge bubble of the overvalued enterprise value increases the risk of the market and becomes a major hidden danger for the China’s securities market development, as well as social and economic development. In this context, how to suppress earnings management behavior of the listed company, reducing earnings management space and regulating the behavior of the listed companies’information disclosure become the only way to enhance the effectiveness of securities markets. At the same time, with the deepening reform of the governance structure of listed companies in our country, the board of directors, ownership structure and other features also change. These changes will have effects on the earnings management. Therefore, this paper studies the impact of changes in these characteristics on the companies’earnings management. It has important theoretical and practical significance to promote the healthy development of China’s capital market.This paper is based on the previous studies and adopts the combination of theory and empirical method. Starting from the analysis on earnings management related theories, this paper first introduces the concept of earnings management, motivation, and the basic theory of earnings management. Secondly, on the basis of theoretical analysis, this paper uses a sample of firms which listed in Shenzhen Stock Exchange during the year2007to2012for empirical research and investigates earnings management behavior of listed companies from ownership structure, board characteristics, financial characteristics and information disclosure four aspects. The results show that the proportion of institutional ownership, board meeting frequency, asset quality, operating income growth and the quality of information disclosure have certain inhibitory effect on earnings management behavior; The size of board dose not have inhibitory effect on earnings management behavior, on the contrary, it promotes the earnings management of listed companies. While the proportion of the largest shareholder shareholding, the proportion of independent directors and intangible assets are not related with the degree of earnings management.Finally, this paper puts forwards the following suggestions:perfect the system of independent directors to enhance the independence; improve the system of board of directors; perfect the securities market regulation and strengthen supervision; cultivate institutional investors to diversify the ownership structure. Hope to inhibit earnings management behavior of listed companies and contribute to the healthy development of the capital market.