Positive study on internal governance and earnings management of Chinese listed companies

This paper explicates respectively the conceptions of corporate governance structure and earnings management as well as some relative theories.Based on the framework of the external and internal(governance) structure,it discusses the implications of the deficiencies of the corporate governance structure on the earnings management of listed(companies) according to the real situation of the Chinese listed(companies.) From the audit opinions,several listed companies are sampled whose audit reports had been nonstandard in 2004.Positive analysis is carried on concerning the relationship of governance structure and earnings management with various methods from descriptive statistics to regression analysis in terms of the characteristics of corporations,such as the feature of board of directors.Some suggestions are given to(improve) corporate governance structure with the hope to provide some effective means to regulate the(behaviors) of earnings management in listed companies.