Research On Earnings Quality Evaluation Of Listed Companies In Automobile Enterprises

The automobile industry has become the essential part of the national economy in the current economy situation,which has the basic characteristics of long industrial chain,wide coverage and great influence,and is an important driving force in the economic and social development.As far as the automobile industry in China is concerned,we must accurately grasp the future prospects of the automobile industry,analyze the various problems existed in the developing progress,changing from the limitations of preponderance towards the quality superiority in order to achieve the ultimate goal of "getting bigger and stronger".This paper is based on the industry facing the transformation of the background,from the financial perspective of the enterprise’s surplus quality research.This paper is studying the firm’s earnings quality from financial perspective based on the industry’s ongoing transformation.On the basis of local and global researches of earnings quality,with the conjunct of the distinctive characteristics of automobile firms,this paper has validated a design of an earning quality evaluation system for listed automobile companies which effectively demonstrates four aspects simultaneously,profitability,liquidity of earning quality,future earnings forecast and R&D capability of the listed companies in the past.Through the collection of financial data of listed vehicle manufacturing companies in SSE(Shanghai Stock Exchange)and SZSE(Shenzhen Stock exchange)from 2014 to 2018,a more objective evaluation system is established with adoption of entropy weight method,which provides references for listed automobile firms in transformation and other companies in this industry.Taking a panoramic view of the current circumstances of earnings quality evaluation system,it is generally based on the foundation of characteristics of earnings quality,and is not highly applicable to automotive companies.Automobile company inevitably has industry specific labels,such as high R&D investment and large inventory.These factors should be taken into account when evaluating the earnings quality of listed companies in automobile companies.Considering the actual situation of listed companies in Chinese automobile companies,building a performance evaluation index system for listed automobile companies not only enable automobile companies to find approaches to improve their earnings quality,but also help stakeholders to evaluate earning quality objectively and therefore make reasonable decisions.