The Empirical Research On The Role Of Local Governments’ Performance Examination Influence On Earnings Management Of The Listed Companies

Since the reform and opening up in1979, the local government work patterns from the top-down"command execution" into the fiscal decentralization. local government in the area of the allocation ofresources have economic and political authority. Regional economic development is rooted in the locallisting Corporation to a large extent, namely through the capital market resource allocation function.Therefore, the local government from the tree’s point of view, motivation and the ability to use fiscal andtaxation to help the area of listing Corporation to conduct earnings management, listing Corporation underthe local government for political pressure, to complete the task within the normal operating not condition,will take the initiative to meet with the earnings management mode of government performancerequirements. Therefore, in this paper, influence of local government performance evaluation on the listingCorporation of earnings management, this topic is worth discussing.In this paper, China’s A-share market city listing Corporation experience data during2007-2011assample, based on the above theoretical and empirical analysis, we draw the following conclusions: in areaGDP growth rate of government performance evaluation index have significant negative impact onearnings management of listing Corporation. A region of the GDP faster growth, residents of the District ofemployment, income and welfare is higher and higher, and most of these indicators, depending on the areaof enterprise development level, the higher the more pressure, so the local governments in pursuit ofpolitical achievements to expectations and pressure transferred to the area of enterprise, if the extent ofearnings management of enterprise economic influence is higher the lower. Further consideration of thenature of property rights, while the non-state-owned enterprises have more motive of real earningsmanagement positive, but the state-owned enterprises with real earnings management better conditions, sothat they are inclined to see, there is no significant difference of real earnings management. Then,according to the government to control the level of further dividing the state-owned enterprises, localgovernment control of the state-owned enterprises to bear a dual responsibility, pressure is great, the impacton earnings management significantly higher than the central enterprises. Because of the unbalanceddevelopment of regional economy, according to the division of administrative areas of East and West,through regression analysis found that the influence of the central and eastern regions significantly.On the above basis, this paper put forward the criterion and the suggestions to improve theperformance evaluation system of local government, meanwhile enhancing the listing Corporationinformation disclosure supervision, improve the relevant legal system is the basic measure of earningsmanagement to grab the private benefits of control.