A Application Study On Fraud Recognition And Prevention Refer To Taxation In Corporate Finance In The Third Period Of The Golden Tax Project

With the economic development， the importance of financial accounting hasbecome more observable. At the same time， the financial reporting fraud has alsobecome a lingering shadow. This paper is not simply to identify the corporation asthe main profit winner in financial fraud. On the contrary，this paper goes deep intothe analysis of interrelated interests involved based on the view of the commonwealthof certain covenants in the corporate contract theory. In line with the analysis， themanagement maybe the only actor in financial fraud. Further， improper economicprofits obtained by the management through financial reporting fraud display mainlyin: manipulation of the market， equity financing， debt financing， managementincentives， and tax non-compliance. Instead of seeking what improper profits themanagement is looking for through financial reporting fraud， this paper argues thatthe main responsibility of tax department which as the important user of the corporatefinancial reporting information， is to review whether corporate tax returns are in linewith the provisions of relevant laws and regulations or not. How to identify andprevent corporate fraud in seeking profits in the manipulation of the market， equityfinancing， debt financing， and improper management incentives and corruptbehavior， many scholars have conducted profound research and analysis. Inconsideration of it is very important who the third period of the Golden Tax Project inthe taxation history， the emphasis of this paper is on how to identify and preventfinancial reporting fraud while seeking profits from tax non-compliance activities.This paper covers four main parts. The first part， based on the reviews ofdomestic and foreign financial reporting fraud theories， proposes an overall idea forthe tax department in identifying and preventing corporate financial reporting fraud.The second part proposes the information system is the only support to improve theefficiency of tax audit based on the analysis of game theory and transaction costtheory. Among the factors affecting the game between the tax department andcorporations， audit efficiency are considered to be the effective factors which can betruly controlled by the tax department. The third part， based on the analysis oftheories and practices of the latest developments in foreign tax audit and also theinnovative use of the risk management theory and Wiki-economics ideas， providesspecific practices in improving the efficiency of tax audit in the third period of the Golden Tax Project. The fourth part provides a number of recommendations tostrengthen the Identification and prevention system of corporate financial fraud. Inthis paper， theoretical analysis and practice confirm each other， the identificationand prevention measures are reasonable， so it brings a new idea to solve theproblems of corporate financial reporting fraud.