A Study On The Earning Management During The Performance Pledge Of The Listed Company

Starting in 2014,the capital frenzy swept through the film and television industry,and a large number of film and television companies appeared to focus on the demand for capital markets.Because of the difficult road to break into the IPO,there is a great deal of uncertainty,which makes many film and television companies choose to borrow backdoor listing to achieve the goal of rapid access to capital markets.But the enterprise value appraisal has become the backdoor listing reorganization operation focal point.Because of information asymmetry,transaction information is likely to be adjusted and controlled by the underlying company,so that higher M & A prices are labeled with high prices.In order to reduce the risk of backdoor listing under "high valuation" and protect the interests of investors,a considerable number of enterprises will sign performance commitments,that is,if the counter party can not complete the profit target in the expected performance commitment,it will need to pay high compensation.But in the present form,the performance commitment system of our country is still in the stage that needs to be perfected,which gives the target company the opportunity to take advantage of.In order to keep the stock price in the growth state,avoid the high compensation,or reduce the compensation pressure,the company will use earnings management to improve its performance,complete the performance commitment target and send a positive signal to the market.And this so-called "myopia" seriously damages the long-term interests of minority shareholders,and then affects the long-term development of the company.Based on the relevant theories,this paper adopts the combination of horizontal analysis and vertical analysis,and studies the earnings management behavior of performance commitment companies in the context of backdoor listing in the form of cases.Based on the case of the first shares listed on the backdoor of the Great Wall Film,this paper expounds the performance commitment scheme of the merger and acquisition,as well as the concrete completion situation during the three years.After that,this paper analyzes the motivation of the Great Wall Film to carry out earnings management in the stage of performance commitment,combines the modified Jones model and the test real earnings management model to test the earnings management of enterprises starting from the financial indicators and non-financial indicators,respectively,to identify the earnings management carried out by the Great Wall Film during the performance commitment period.From the aspects of financial performance,shareholder wealth and so on,this paper studies the economic consequences that the company needs to face in carrying out earnings management.The results show that the main motivation to promote the earnings management of the Great Wall Film is to fulfill its performance commitments signed in the backdoor listing,avoid high performance compensation,and send a positive signal to the market.Great Wall film and television in the performance commitment period of the main use of earnings management means is M & A reorganization "buy and sell profits ".And the Great Wall film use earnings management means,although in a short period of time can improve corporate performance income,to help small and medium-sized shareholders to obtain short-term benefits.But in the long run,it is not a good thing for the development of enterprises,and it damages the long-term interests of minority shareholders.Based on the above analysis,this paper gives the following suggestions to the earnings management behavior during the performance commitment period:(1)To perfect the asset pricing system;(2)To introduce non-profit indicators in the performance commitment agreement;(3)To strengthen the special audit of the performance commitment;(4)To evaluate the earnings management behavior of enterprise value identification.Through the analysis of the research cases,it is expected to enrich the relevant research on the performance commitment and earnings management phenomenon in China’s capital market to a certain extent,effectively reduce the pressure of market M & A risk,provide corresponding protection for investors.