Problems And Governance Of Financial Fraud Of Listed Companies On

Financial fraud has been a common concern of scholars all over the world. In our country, motherboard market the company’s fraud has attracted people’s attention, experts and scholars has been carried out in-depth research, and do poineering work board set up time is not long, research on GEM companies fraud is not much. At the same time, the gem set up a short time, the relevant laws and regulations are not perfect, the research on the gem related issues to help the development and improvement of the gem. Therefore, this paper from the perspective of the gem, focusing on research and analysis of the gem company’s financial fraud.The gem of our country was established in 2009 in Shenzhen. Listing Corporation are mostly small and medium sized companies and companies with a certain level of science and technology. Gem from the beginning of the establishment of the 28 companies to the development of nearly 500 listing Corporation in 2015, the development speed is very fast. In the process of rapid expansion, some of the problems began to emerge. The first is the performance of face". Some small and medium companies in the pre listing, in order to pay less taxes, deliberately conceal the company’s income, the cost of human adjustment costs. Wait until the time to market, in order to obtain the listing qualifications, and often artificially raised income, increase profits. And when the company after the listing, as a result of fraud before the listing, coupled with the company’s poor management, performance is often difficult to continue. The second is the "three high", namely high issue price, high price earnings ratio, high raise funds. Because the company is basically in the GEM companies are small and medium sized companies, the share capital is small, easy to be sought after and speculation, the issue price is often higher. The issue price, the price earnings ratio is high, will raise funds. Some of the funds raised by some companies are far beyond the capital needed to plan the project. Some of the funds raised by the existence of the bank, and some have dropped to some of the project is not very ideal, and some even idle, resulting in a waste of funds. Third is the problem of inadequate supervision. Due to the establishment of gem is not a long time, the rules and regulations is not perfect, such as the sponsor system of punishment mechanism, etc. are to be gradually improved in practice and development.In view of the above background, this paper first introduces the concept of financial fraud, analyzes the characteristics of financial fraud, and describes the consequences of financial fraud. On the basis of this, a pharmaceutical company as an example, focusing on analysis of the China’s gem motivation of financial fraud of listed companies and common fraud method, and method for different reasons and fraud, from the perspective of listed companies, intermediary institutions, levels of the government and industry associations and other proposed fraud prevention countermeasures and suggestions.