Research On Cash Dividend And Earnings Management Of Listed Manufacturing Companies In China

As the accelerating global economic integration,the development of capital market plays an increasingly important role in countries' economic growth.Chinese capital market is now in the process of reform and development.The capital market environment has not fully formed fairness and effectiveness,and the market supervision still needs to be improved.In the domestic academia,it is widely accepted that listed companies have earnings management behavior.In order to achieve the IPO or refinance standard in a short period of time,many listed companies have strong earning management motivation.For investors,cash dividend is one of the main ways to obtain investment income.To encourage cash dividends,China Securities Regulatory Commission(CSRC)has formulated many rules to relate listed companies' cash dividend and refinance behavior.However,in order to refinance or obtain benefit,the listed companies' managers have the motivation to do earnings management,because the profit is the foundation of cash dividend.According to the survey and research in this paper,the listed companies that distribute cash dividends in China show a significant upward trend between 2013 and 2017,but the overall cash dividend distribution level is still low(the average is 32% of the net profit)and the phenomenon of no dividend still exists.In addition,the situation of biggest shareholder centralization and non-equilibrium development of institutional investors is also a common phenomenon in China's listed companies.The existing literature has little research on earnings management,cash dividend and equity structure(majority shareholder and institutional investors),and the relationship between the three is the focus of this paper.Based on existing literatures,earnings management is influenced by industry.Based on the study of this paper about the industry rankings in cash dividend,we can find that the manufacturing industry shows the largest percentage(48.06% in 2017)and representative,while the proportion of information service industry,which ranks second in cash dividend distribution,is only 5.30%.Therefore,this paper selects sample data of manufacturing listed companies from 2014 to 2016.This paper firstly discusses the relationship between cash dividend and earnings management in listed companies,and discusses the relationship between cash dividend and earnings management in combination with majority shareholders and institutional investors.The result illustrates: Firstly,when the target earning needed to allocate cash dividend is higher than the real earning,the listed company will carry out obvious upward earnings management behavior.In addition,the shareholding ratio of majority shareholders and institutional investors has significant restraining influence on earnings management of listed companies for cash dividend distribution.However,there is a significant positive correlation between stable institutional investors and earnings management in cash dividend distribution.