%A TONG Yan , WANG Huacheng %T Related party transactions, benefits of control and earnings quality %0 Journal Article %D 2008 %J Front. Bus. Res. China %J Frontiers of Business Research in China %@ 1673-7326 %R 10.1007/s11782-008-0011-x %P 187-203 %V 2 %N 2 %U {https://journal.hep.com.cn/fbr/EN/10.1007/s11782-008-0011-x %8 2008-06-05 %X Controlling shareholders pursue benefits of control (private benefits and shared benefits) via related party transactions, which result in different levels of earnings quality. Using data from all A-share listed companies in Shenzhen and Shanghai stock markets in the year 2001 and 2002, we found that when the share ratio of controlling shareholder is less than 50%, they prefer pursuing private benefits of control via related party transactions, giving rise to deterioration in earnings quality. By comparison, when the share ratio is more than 50%, controlling shareholders prefer pursing shared benefits of control through related party transactions, which improve earnings quality as a result.