Study On Earnings Management Of Overseas Listed Private Enterprises

In December 16,2016,the muddy water agency released a report on Huishan Dairy.In the 47 page report,the muddy water lists Huishan began issuing false financial statements from 2014,and points out a series of problems.While Huishan was struggling to cope with these issues,the left of company's main management person in charge of finance,the lost a lot of money made the company finally be in crisis.In March 24,2017,the black Thursday,the company's shares plunged nearly 90%and fell into a suspended state for a long time.Because Huishan Dairy which was praised by the industry for a long term suffered from such a huge crisis,the public view pay attention to overseas listed private enterprises again.Why do these companies go to a more effective capital market and accept more strict legal regulation,but the earnings management behavior of them has not been significantly suppressed?The study of overseas listed companies mainly focused on the bonding theory and internal governance effects.The perspective of earnings management research is relatively rough,didn't distinguish different bonding theory from the perspective of the nature of the company and did not pay more attention to the company's external governance.Therefore,the characteristic of this paper is to focus on overseas listed private enterprises as the research object,trying to find the effect of bonding theory from the root by studying the complete influence path of the effective capital market--the internal and external governance mechanism--company earnings management.The goal of this paper is based on the contradiction between theory and reality.By exploring the relationship between the effective capital market(Hongkong market),internal and external corporate governance and then finding corporate earnings management behavior on the basis of internal and external governance mechanism,we can understand the bonding theory from the deep level of perspective.Based on this,the expected findings are as follows:firstly,effective capital market can really enhance the enterprise's internal and external governance mechanisms;Secondly,because of the internal governance structure defects,audit difficulties,regulatory difficulties and other reasons,the effects of bonding theory and the promotion of the internal and external governance mechanism are restricted,which can't significantly curb the earnings management behavior of enterprises.As an important part of China's economic power,the long-term development of private enterprises is related to the health of our country's economy.Through the study of the overseas listed companies' earnings management behavior,we can understand overseas listed enterprises through bonding theory effect which is influencing the internal and external governance mechanisms to influence the behavior of earnings management.At the same time,as a special group of private enterprises,enterprises should actively use their own behavior and external intervention to enable themselves to provide higher quality financial reporting information for investors.