Study On Financial Risk And Its Prevention Of Related Party Transaction Of Listed Company

Related transaction is also called related party transaction or transaction between related parties. We think, its characteristic may be summarized to be transaction between members of inter-enterprise combine whose inner relationship is control and united management. Though each transaction party has its legal personality in term of law, the status of transaction party is not equal. Subsidiary enterprise is likely to lack of independence, to affiliate to controlling enterprise and to be an instrument to serve for the benefit of combine.There are many ways in risk classification, generally speaking, financial risk of related transaction of listed company can be divided into 4 types: (1) risk of non-balance and short-termed income resulted from non-frequency of related party asset transaction; (2) risk of high debt ratio and high bad debt resulted from fund occupancy of related parties; (3) risk of contingent loss resulted from related party guaranty; (4) risk of low cash flow and high bad debt resulted from purchase and sale of related parties,To measure financial risk of related party transaction, we introduce the modern enterprise financial value theory. Because the income of related party transaction is uncertain and accidental, people are difficult to judge expected goal about financial system operating and difficult to judge exactly the enterprise value.Related party transaction may be either inputting profit or outputting profit, financial risk of outputting profit is obvious, related transaction of inputting profit seems beneficial, in essence, large risk lurks, for it has special purpose with short-term and non-balance, and it is difficult to promote continuous development of listed company.Existing of related transaction of Chinese listed company has deep historic background and actual environment. Financial risk management of related party transaction, that is, how to measure, control and reduce financial risk of related transaction, how to control the fluctuation of enterprise cash flow and profit, people must utilize the inner and outer aspects. On the one hand, we shall strengthen supervision and perfect current accounting norms and other relevant laws and regulations. On the other hand, by improving company governance, perfecting company inner risk control system, we will establish modern enterprise system really.