A Case Study On Flnancial Due Diligence Of Government Guide Fund Equity Investment

Since China’s economy entered the stage of high-quality development,it has become an important focus to promote the upgrading of industrial structure,improve the efficiency of factor allocation and transform the economic development mode.As an important measure for local governments to promote the development of regional industries,the equity investment of government guide fund can attract social capital to flow into the region and support the development of new,characteristic and advantageous industries in the region.Financial due diligence as a scientific and fair assessment of equity investments of the company’s accounting entity,financial organization,financial statements and table project is a key link in all aspects of quality,is the important basis of investment decision for investors,for the government to guide the correct decision of the equity investment fund and the accurate positioning and implementation has the decisive significance.The equity investment of government guide fund is a special public investment under the guidance of local government.Compared with the financial due diligence of other social capital equity investment,the process and indicators of the financial due diligence of government guide fund equity investment should focus more on the development prospect and public benefit of enterprises.The study case of this paper is that TY Investment Company in T City entrusted X Accounting Firm to carry out financial due diligence activities on the equity investment of government guided fund in D Chemical Company.Under the guidance of information asymmetry theory,information productivity theory,principal-agent theory and externality theory,the process and indicators of financial due diligence for equity investment of government guide fund are optimized.In system analysis,analysis the background of the government guiding fund equity investment D Chemical Company,TY Investment Company,X Accounting Firm,on the basis of trilateral relations,we survey of X Accounting firm financial due diligence preparation stage,implementation stage and survey report formation stage,the specific content and process in detail and in-depth,system analysis.Based on the publicness and demonstration of the equity investment of the government guide fund,This paper proposes that X Accounting Firm’s financial due diligence indicators are not selected scientifically,the investigation process is not perfect,and investigators lack the awareness of combining financial information with non-financial information.Finally,on the basis of indepth analysis of the problems and causes,the process and index selection of the financial due diligence for the equity investment of the government guide fund are optimized.The first is to add the index to measure the positive externality of the target company.Second,it is suggested to perfect the index to measure the sustainable development ability of the target company.Third,it is suggested to increase the entrusting stage and follow-up stage of financial due diligence,and improve the implementation stage of the investigation.Fourthly,it is proposed that the financial due diligence of the equity investment of the government guide fund must reflect the integrity,comprehensiveness and public nature,and combine the financial indicators and non-financial indicators.Fifth,the applicability process and index system of financial due diligence of government guide fund are designed.Sixth,it is suggested that X Accounting Firm build a specialized financial due diligence business team.