A Study On The Relationship Between Corporate Governance And Financial Statement Fraud In The Product Market Competition Environment

The empirical study on the relationship between corporate governance and financialstatement fraud has concentrated in western developed countries for long, but it has nocertain conclusions. The studies now only focus on one fact of corporate governancewithout considering them as a whole; meanwhile they can’t put all of them in the productmarket competition environment. So the internal and external systems of corporategovernance haven’t been showed. The economical and legal environment of our country isspecial, so the effects become more complicated.To the above problems, this thesis studies the domestic and international researchliterature, then research the theory of industrial organization and the theory of corporategovernance, and finds their relationship with the financial fraud, on this basis, Thisthesis analyzes the empirical relationship between product market competition, corporategovernance and corporate financial fraud,This thesis also compares the corporate fraud ofdifferent companies, and then analyzes the internal and external systems of corporategovernance of companies that have good performance. The study concludes that:（1）the relationship between product market competition and company financialfraud is significantly negative; The relationship between different corporate governancefactors and company fraud is not the same, the company integrated governance andcompany fraud are negative related, Board Governance, governance of the board ofsupervisors, executive incentive and corporate fraud do not exist significantly correlation,the relationship between the equity and company fraud is negative related.（2）After analyzing the differences of product market competition and corporategovernance of companies whose fraud is different，this thesis finds that only we haveimproved conditions of product market competition and corporate governance, can weeffectively improve company，s fraud. The most effective management mode is the higherdegree of product market competition with the stronger corporate governance. Compared with the previous research, the innovation of this thesis is that thecompany internal and external management environment factors were put in the sameframework of research, and the theory and empirical research in this field are furtherdeveloped. There are also some shortages in this thesis, for example, this thesis did notdecomposed out the influence of the product market competition through the corporategovernance on the fraud, which was not further analyzed; and the dependent variable stillwas subjectivity measured on some degree.