Research On Earnings Management Behavior Of St Company In The Process To Get Rid Of Special Treatment

In recent years.China's domestic fertilizer market continues to be depressed,urea prices continue to fall.ST Hehua,as the key fertilizer enterprises in Guangxi and the only listed company in Hechi Provincial,the company's main business income mainly comes from fertilizer income.Affected by market factors,the company's operating losses persist in recent years.The ST system is one of the systems issued by the stock exchange for the standardized management of listed companies in China.The purpose is to distinguish between companies with financial problems or other operational problems in operation and companies with normal operating conditions,so as to explain to investors Listed companies have large investment risks,reminding investors to pay attention to the trade-offs between risks and benefits.*ST Hehua has been used special treatment for three times in the past eight years,and there is a relatively obvious purpose to preserve and modify the company's performance through earnings management.Through the analysis of the earnings management behavior of*ST Hehua in the three capping processes,it is found that in 2010,*ST Hehua mainly manages earnings through debt exemption and affiliated transactions.The earnings management practices involved in 2013 are related transactions and government subsidies.In order to achieve profitability in 2017,the Hachi Municipal Government gave the company 50 million yuan of operating financial subsidies during the reporting period;received 80 million yuan of cash donated by Yinyi Group;Government debt relief and auction of accounts receivable,these matters have provided a powerful help for the company to achieve profitability.Finally,based on the case study of*ST Hehua case,it is considered that the continuous loss of*ST Hehua has a strong shell-keeping motive,and its shell-keeping process is unreasonable.Continuous loss without executing the delisting system will consume market resources.Increase the risk of fraud in the securities market.Finally,suggestions for existing problems,including two parts,based on market perspectives:strict implementation of the delisting system,increase penalties;improve the relevant conditions for the recognition of non-recurring gains and losses;regulate the relevant provisions on government debt exemptions;Based on the company's point of view:aware of the adverse effects of excessive earnings management and strengthen internal control over the company,hope that these recommendations can further promote China's securities market in a better direction.