Toread Holding Group Earnings Quality Study

Earnings quality is an index to measure whether the earnings data in the financial report of an enterprise can fully reflect its intrinsic value.Studying the earnings quality of an enterprise can help stakeholders to have a comprehensive understanding of the earnings status of the enterprise from a micro perspective,and at the same time make various decisions according to this premise.For example,enterprise managers can make appropriate decisions for the development of the enterprise,and investors can make correct investment decisions and reduce investment risks to obtain returns.From the macro level,the typical case study of earnings quality can provide a specific observation window for the future development of the industry in which the individual enterprise is located.On the premise of systematically summarizing and sorting out the concepts and theories related to earnings quality,this thesis analyzes the operation situation of Toread Holding Group,a selected case enterprise,and fully considers the financial characteristics of its industry.On the premise of reliable data sources,an earnings quality evaluation system is constructed from four dimensions: profitability,stability,cash security and growth.Based on the evaluation index of the evaluation system,the thesis makes a longitudinal comparative analysis of Toread Holding Group from 2017 to 2022 in four aspects:profitability,stability,cash security and growth.At the same time,the performance of other selected enterprises in the industry in the above four aspects was compared and analyzed horizontally.The results show that Toread Holding Group has some problems,such as weak overall profitability,lack of operating stability,low quality of cash recovery and poor operating growth.Then,from the internal and external factors two aspects of the reasons affecting the quality of earnings are analyzed in detail.Finally,in view of the problems existing in Toread Holding Group’s earnings quality and the causes of the problems,this thesis proposes to steadily promote the dual main business model,prevent and control goodwill impairment risk in investment,seize development opportunities in line with national policies,strengthen accounts receivable management to improve cash security,deepen traditional main business to improve core competitiveness,and pay attention to improving enterprise operation and management level.A series of suggestions on improving supply chain management,reducing operating costs and improving its earnings quality.This study is helpful to accurately and comprehensively grasp the earnings quality of Toread Holding Group,explore the existing problems in the company’s earnings quality,explore the causes,and provide reasonable suggestions,with a view to improving the overall earnings quality of Toread Holding Group,contributing to its future development,and providing certain reference for other enterprises in the same industry.