Study On Motivation And Governance Of Accounting Fraud

It is known that the capital market is tainted by accounting fraud with development of it during the past twenty years continuously.The fraud has become a major public hazard in economic life since it will not only bring tremendous shock and negative impact on China's capital market,but also make investors suffer huge loses.Relevant departments of the Chinese government have formulated large numbers of laws and regulations against the accounting fraud,however,fraud cases still occur from time to time.Therefore,it has important practical significance to study the identification,motivation and governance measures about the accounting fraud.This paper discusses the problem of accounting fraud using the case of Sinovel Wind Group Co.,Ltd.expecting to strengthen prevention and governance in this area.The first part mainly introduces the background of Sinovel,the process of accounting fraud and the results of the SFC.Then,the paper describes the means of accounting fraud,pointing out that forging documents to inflate the revenue and cost is the main means.Afterwards,the paper analyzes the causes of fraud of Sinovel from five dimensions including moral character,motivation,potential fraud opportunities,possibility of fraud exposure and punishment efforts thanks to the theory of fraud risk factors.Finally,in order to provide some reference towards regulating capital market and the financial behavior of companies,the last part puts forward suggestions from five aspects including increasing the moral costs of fraud,reducing the fraud motivation from source,strengthening the legislation and supervision,optimizing the company's internal control and governance structure,improving civil compensation system and related sanctions.