دانلود رایگان مقاله انگلیسی معیارهای درآمدها، مدیریت درآمدها و عملکرد آینده بورس شرکت های چینی لیست بندی شده - امرالد 2017

Abstract

Purpose: Prior literature has revealed three key earnings benchmarks: i) earnings level; ii) earnings change; and iii) analysts’ expectations. The purpose of this study is twofold. First, we seek to establish which earnings benchmark induces the largest extent of earnings management. Secondly, we explore the implications of earnings management on firm future performance. Both of these purposes are investigated for Chinese listed companies during China’s IFRS/ISA reporting era. Design/methodology/approach: We rely upon the unique regulations and incentives for Chinese listed companies in order to develop four testable hypotheses. Next, we employ both logistic and ordinary least squares regressions to test the hypotheses. Findings: Our results suggest that Chinese listed firms have the highest level of income increasing discretionary accruals around the earnings level benchmark, followed by the earnings change benchmark. We don’t find any evidence of earnings management to beat analysts’ expectation. In addition, we find evidence that Chinese listed firms with relatively high level of earnings management and low earnings exhibit relatively weak future stock performance. Originality/value: Our findings are the first to document an earnings management benchmark hierarchy with respect to the extent of income increasing discretionary accruals, while simultaneously establishing a link between earnings management and firm future stock performance, for Chinese listed companies. Our findings are valuable for regulators and investors by suggesting that management intervention in the reporting process during China’s IFRS/ISA reporting era may act to circumvent delisting regulations and cloud earnings signal for firms that beat certain earnings benchmarks.

6. Conclusion

In this paper, we investigate the relationship between earnings benchmarks, earnings management, and future stock performance for Chinese listed firms. Our results highlight the importance of a well-developed regulatory framework, the economic consequences of having regulations linked to accounting-based measures (Jiang and Wang, 2008), and the market’s ability to make rationale adjustments for earnings management (Haw et al., 2005). Specifically, we show that during the IFRS/ISA reporting era, Chinese listed firms direct more earnings management efforts to report positive earnings, than to report earnings increases. In addition, we find evidence that Chinese listed firms with relatively high level of earnings management and low earnings exhibit relatively weak future stock performance. The results of this paper have implications for regulators and investors. As our findings reveal the existence of earnings management to meet or beat the earnings level benchmark, as well as the earnings change benchmark to a lesser extent, regulators should take the above into consideration when revising existing regulations and/or designing and implementing new regulations. Even though the current accounting standards cannot control the use of discretionary accruals to manage earnings, the financial market does make rational adjustment for earnings management through weaker future stock performance. Such results are important to the investors when making investment decisions.