The impact of new accounting principles on earnings management means of listed companies in China

The “asset impairment” standard of new accounting principles requires that assets impairment provision shall not be reversed. Based on the angle of voluntary changes of fixed assets accounting policy, this paper study the changes in means of earnings management of listed companies in China before and after new accounting principles. The research verify that new accounting principles significantly inhibit the enterprises to positively adjust earnings by fixed assets impairment reversal, and find that (1) new accounting principles curb companies´ negative earnings management means of fixed assets impairment provision to some extent; (2) under the premise that the means of earnings management of fixed assets impairment provision and reversal is suppressed, new accounting principles do not enhance the earnings management means of fixed assets depreciation policy changes; (3) companies with loss motive turn to the bad debts ratio changes for earnings management, while the listed companies with profit smooth motive tend not to change the proportion of bad debts to regulate earnings.