Because of the widespread existence of profit manipulation and people's abhorrence of false accounts, "profit manipulation" is customarily understood as malicious profit manipulation, which is actually a misunderstanding. Strictly speaking, profit management does not violate accounting principles, and the current accounting theory and system have certain support for profit management.
First, the premise of profit management
1. The profit index is relative, not absolute. The basic task of accounting is to provide true and reliable economic information to users of statements, but the authenticity and reliability of information are relative, not absolute. The historical cost principle, accrual basis principle and matching principle in accounting principles leave room for the recognition of enterprise income and cost.
2. The new accounting standards allow moderate flexibility in accounting treatment. According to the characteristics of the industry, different enterprises can take certain choices to deal with certain accounting business. The management of an enterprise will consciously use its influence to choose a method that is beneficial to its current or long-term interests, thus affecting the measurement of profits and realizing the management of profits.
3. Information asymmetry makes different subjects have different understandings of profit indicators. The information among managers, investors and creditors is unbalanced. The manager chooses accounting procedures and methods, and he knows accounting information like the back of his hand. However, investors and creditors are not. Even if they entrust auditors, they can't clarify the accounting information of enterprises like managers.
Second, the motivation of profit management
1. The drive to maximize returns. If the current profit is used as the main index to evaluate the management, the management obviously has the impulse to make the current profit higher. Moreover, some management work in the current period (such as technical transformation) may not help or even damage the accounting profit in the current period. This defect leads to the short-term behavior of management, which is very unfavorable to the long-term development of enterprises.
2. Increase profits for corporate image. Some enterprises improve their performance in order to obtain funds from investors and creditors. Unlisted joint-stock companies operate profits in order to make their shares meet the listing standards; Listed joint-stock companies also operate profits in order to become blue chips. In the long run, the real business situation of the enterprise is the most critical point. Through manual adjustment, the profit can only be changed in advance or delayed in the report.
3. Reduce profits due to deferred payment of enterprise income tax. For the benefit of the enterprise, as far as possible within the scope permitted by the tax law, the profits will be compressed in the form of early input fees, thus reducing or delaying the payment of income tax.
4. In order to avoid delisting due to continuous losses, some listed companies will artificially adjust the income and expenses in different accounting years to adjust the profits or losses between different years. For example, they will recognize more expenses in the last year and underestimate their income to achieve profits in the last year.
5. Balance profits. This is an accounting behavior to realize the stability of the company's income. Companies whose earnings often fluctuate violently will reduce the confidence of investors and increase the financing cost of the company.
Third, the way of profit management.
1. Managing profits through asset restructuring
Asset reorganization is an asset conversion and equity conversion implemented by enterprises to optimize capital structure, adjust industrial structure and complete strategic transfer, but it can also be an important means of profit management. For example, some listed companies sell idle or bad assets at high prices, or sell high-quality assets under non-listed companies to listed companies at low prices to increase profits.
2. Manage profits by purchasing assets or changing depreciation methods.
If an enterprise purchases fixed assets in advance, the current profit can be appropriately reduced; On the contrary, the current profit can be appropriately increased. Among the factors that affect depreciation, the depreciation base and the net salvage value of fixed assets are relatively easy to determine, and the tax law leaves a lot of room for enterprises to determine the service life of fixed assets.