Research On Financial Fraud Of Dongfangjinyu Co.,Ltd.

The financial report issued by an enterprise can reflect the financial situation,operating results and cash flow of the enterprise in a certain period comprehensively and completely.The financial report directly reflects the performance of the enterprise management.Through the analysis of the data in the financial report,the enterprise managers can timely find the problems existing in the production and operation process of the enterprise,so as to implement the corresponding countermeasures to solve these problems and improve the management level.For the majority of external investors,the financial report is the direct information for them to understand the financial situation of the enterprise,which directly affects their investment decisions.However,China’s listed companies are increasing year by year,but in recent years,the overall economic situation of China’s market is not good,leading to many listed companies operating difficulties and financial market management system is not perfect and other factors,many financial fraud cases occur every year,so it is of great practical significance to study the financial fraud cases and put forward enlightenment and prevention suggestions.Dongfangjinyu Co.,Ltd.(hereinafter referred to as ~*ST Jinyu)was established in1993 and listed in 2004.As a leading enterprise in the jadeite industry,financial fraud has been carried out since 2016.Due to so much money involved,it has caused a very bad social impact and has been named by the regulatory authorities for many times.In 2020,China Securities Regulatory Commission has imposed corresponding penalties on ~*ST Jinyu company and relevant responsible persons.The subjective malice of ~*ST Jinyu’s financial fraud is obvious.The means are as follows: first,fictitious purchase and sales transactions;second,inflated profits;third,concealing huge inventory.Through these ways,~*ST Jinyu realized the purpose of financial fraud.This article first briefly introduces the background of ~*ST Jinyu financial fraud.the research methods used in the process of case study,and summarizes the research content.Among them,this paper elaborates the fraud triangle theory used in this case study,and uses the internal control theory and the construction of financial fraud risk index model as the support.At the same time,it sorts out the relevant literature in the field of financial fraud at home and abroad,and analyzes the case through the above content.After sorting out the theoretical basis,this paper mainly introduces the enterprise background of ~*ST Jinyu,including its development history,business scope,etc.,and reviews the whole process of financial fraud events from 2016 to 2019,as well as the punishment results.And it specifically analyzes the means of financial fraud and the economic consequences caused by the use of these means.Then,from the pressure,opportunity and excuse three angles to analyze the cause of financial fraud of ~*ST Jinyu in detail.Among them,the pressure factors mainly include the industry pressure faced by the enterprise,the loss caused by poor management,and the risk of delisting;the opportunity factors mainly include the imperfect internal governance system,the obvious defects in the internal control system,the lighter punishment of the CSRC,and the failure of the audit institutions to perform their duties;the excuse factors mainly include avoiding the infringement of the interests of major shareholders To stabilize the stock price.Finally,the fourth part of the article puts forward the measures to prevent financial fraud.First,reduce the pressure by alleviating the industry difficulties and improving the competitiveness of enterprises.Second,improve the corporate governance mechanism,internal control mechanism,increase penalties,strengthen the construction of audit system to reduce the opportunities of financial fraud.Third,strengthen the professional ethics education of management,strengthen the construction of corporate culture to stop the fraud excuse.Finally,we build a fraud model to identify and early warn fraud and prevent financial fraud.