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LI, Jingyang (2020) Investigating the Impact of Corporate Governance on the Relationship between Related Party Transactions and Earning Management: Empirical Evidence from Chinese Private Listed Companies. [Dissertation (University of Nottingham only)]

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Abstract

Abstract

Earnings manipulation and related party transactions (RPT) are common problems and hot topics in earlier academic research. The prior literature on the relationship between RPT and earning management (EM) has developed mature and comprehensive. However, previous empirical research on the relationship between RPT and EM lack considering the concept of CG. Therefore, this research refer CG quality to further analyze and discuss the relationship between RPT and accrual-based EM. The purpose of this research is to analyze the relationship between related party transactions and earning management, and further discuss the impact of different corporate governance environments on the relationship between related party transactions and earnings management in Chinese private listed companies. This research utilizes quantitative research method to analyze the issue between RPT, EM and CG based on the data of 1134 private listed companies from 2016 to 2018. This research uses modify Jones model to measure the level of accrual-based EM and constructs CG index by combining five factors of CG to measure the quality of CG. The results prove that there is a positive relationship between RPT and EM, and the quality of CG has a negative impact on the relationship between RPT and EM. This means that good corporate governance environment helps to alleviate the relationship between RPT and EM. Therefore, management and regulators should pay more attention to establishing a more complete corporate governance system to fundamentally alleviate and improve improper connected transactions and earnings management behavior, whatever from the perspective of the company or the capital market supervision.

Key words: related party transactions; earning management; corporate governance; Chinese private listed companies

Item Type:	Dissertation (University of Nottingham only)
Depositing User:	LI, Jingyang
Date Deposited:	18 Apr 2023 13:50
Last Modified:	18 Apr 2023 13:50
URI:	https://eprints.nottingham.ac.uk/id/eprint/62849

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