Research On Listed Companies' Financial Fraud

In recent years, scandals of "Financial Fraud" have been reported frequently about a bunch of huge even famous listed companies releasing fraudulent financial reports to cheat on their investors all around the world. This has leaded to the majority of the investors losing their trust on these companies' financial reports and their faith in investment. From the point of social wealth, financial fraud leads to the unfair wealth distribution, that means few people will benefit from it with the loss of the majority of people and moreover the loss of the country. Financial fraud will lead to the tremendous waste of economic resources. Even worse, financial fraud messes the regularity of the finance market up, Dishonesties cause bad circulation, that is to say, the degree of the trust of investors on the listed companies they invest depends on the degree of the trustfulness of the financial reports, and the investors will more likely lose their faith on the listed companies if the companies release the fraudulent reports. All the facts will make damage to the economy development and employment situation. Some listed companies of our country also make fraud financial reports, this has made impact on our security market, and Finding out the original causes of the formation of the financial fraud, finding the method to deal with both principal and secondary aspects of the problem has already become a real concern all around.Speaking objectively, several complicated and deep factors including social circumstance and historical reasons contribute to the happening of financial fraud cases. Meanwhile, the speedy development of economy, science and technology, the arrival of the times of "New Economy ", make the means and way of the financial fraud changing rapidly, all these make it even more difficult for us to solve the problem.Till now, the researches on the financial fraud mainly focus on the formation theory and the methods to prevent the happening of it, and the researchers usually employ empirical methods to investigate. The thesis starts from the causes of the formation of financial fraud, and then I will make use of the existed researches on the security market in China and set up the discernment model. The whole thesis is arranged as follows:The first part is the introductory part and gives a brief introduction about the whole thesis including the reasons to choose the topic, the target of the research, the main point of the thesis and the basic methods.The second part is the main part of the thesis. In this part I will firstly analyzesome research results concern the financial fraud, and then evaluate the situation of investigation, according to the reality of security market in China to analyze deeply the causes of the financial fraud. The thesis also concerns about the methods to fraud and empirical method. What is more important, in this part, I set up a discernment model to deal with the problem according to the numbers from some listed companies. At the end of this part, I will give some pieces of advice on how to avoid financial fraud.The third part is the concluding part of the whole thesis. In this part, I will review the whole thesis and make some brief conclusions about the research method and the framework of the thesis.