Earnings Management Of Liquor Industry Based On Deferred Income Tax

With the gradual international alignment of China’s accounting standards,revenue standards and leasing standards have been rewritten,while the income tax law still maintains the original provisions on relevant matters,resulting in the temporary differences between accounting book profit and taxable profit of the tax law.Tax differences can be identified as deferred income tax assets and deferred income tax liabilities under certain conditions according to CAS18,but its recognition conditions are highly subjective,so it provides a lot of space for earnings management of enterprises.In view of the relationship between deferred income tax and earnings management,scholars at home and abroad focus on modeling and empirical analysis of the impact of deferred income tax on earnings management,but fail to take into account the uniqueness of enterprises,and fail to summarize common industrial earnings management methods and their performance for targeted supervision.Therefore,liquor industry is selected as the target industry because they have a large amount of deferred tax asset recognition.This paper mainly studies the motivation and means of earnings management in the liquor industry,summarizes the commonly used means of earnings management and their performance in the liquor industry,and puts forward some constructive suggestions for the earnings management supervision in the liquor industry.Based on the case study method,this paper has selected Swellfun as a typical enterprise for in-depth study,because its deferred income tax assets in the liquor industry accounted for a higher proportion of total assets than the industry average.First of all,it studies relevant literature at home and abroad to understand the earnings management methods commonly used by enterprises,the relationship between deferred income tax and earnings management caused by tax differences,and the existing earnings management regulatory measures.Secondly,it introduces the theoretical basis,mainly the motivation of earnings management and the recognition of deferred income tax.Thirdly,it describes the present situation of earnings management in liquor industry,and expounds the basis of selecting Swellfun as the research focus.Next,it focuses on the earnings management of Swellfun and analyzes the impact of deferred income tax on earnings management.Finally,it summarizes the thinking brought by the case of Swellfun,and puts forward relevant suggestions for the problems,hoping to enrich the relevant cases.At present,Swellfun mainly uses market support expenses,advertising expenses to be deducted and inventory depreciation reserves for earnings management to achieve the purpose of smoothing profits,and does not use related party transactions,deductible losses and other means.By increasing deferred income tax assets and reducing deferred income tax expenses,enterprises can increase assets and increase profits,but also affect the financial indicators of enterprises,hide some financial risks,seriously affect the authenticity of financial statements and affect the decisions of statement users.In this paper,by analyzing the case of Swellfun found income tax accounting standards in our country there is a fuzzy zone,for example,confirmed that there are a lot of deferred income tax assets operational space,the execution of enterprise financial personnel and management criteria not careful,responsible,using the criterion of the fuzzy zone by earnings management.The lack of supervision by external regulators exacerbates the evolution of this phenomenon.Therefore,this paper also gives corresponding suggestions,hoping to truly reduce the phenomenon of earnings management of enterprises,spur enterprises to standardize their development,and improve the quality of enterprises.