Relationship research of EVA and earnings management: Based on the data of central-holding listed companies

This paper discusses the relationship between EVA and earnings management. Firstly, we analyze the correlation of EVA and earnings management in theory and find that EVA can well restrain the behavior of earnings management. Then using the related research at home and abroad for reference, we choose discretional accruals to measure the level of earnings management, bring logarithm of assets, operating income growth rate and asset-liability ratio as control variables and construct a EVA - earnings management linear regression model to verify the EVA´s impacts on earnings management. Through the empirical analysis of the data of central holding listed companies from 2009 to 2011, we find that EVA performance evaluation may have a negative correlation with earnings management and the present EVA performance evaluation of SASAC may well restrain the earnings management.