Research On *ST Bai Te’s Financial Fraud Based On GONE

Over 40 years of reform and opening up,China has established a multi-level capital market structure.Since the establishment of the main board market in 1990,the small and medium-sized board market was established in May 2004.After nearly 15 years of development,the small and medium-sized board market has begun to take shape,cultivating a large number of outstanding enterprises.However,According to the disclosure of the Chinese foreign ministry spokesman GengShuang on September 4,2017,from 2015 to September 2016,*ST BaiTe made up its operating income by 583.12 million and its profit by 256.50 million.The amount of the largest can be called A history of the most.As a result,*ST BaiTe becomes the first company in the small and medium-sized board market to be initiated the compulsory delisting mechanism.This paper selects *ST BaiTe as the research object,and uses the literature research method to sort out and summarize the research on the motivation,influencing factors,means,characteristics and signs,identification methods and prevention and governance of financial fraud at home and abroad.Based on that,combined with the GONE theory of financial fraud,the research idea was clarified.Then,use the case analysis method to analyze the financial fraud case of *ST BaiTe.Through the extensive collation and analysis of the annual report of *ST BaiTe,relevant announcements of CSRC and other relevant public information,this paper explores the means and causes of financial fraud of *ST BaiTe,and puts forward the countermeasures and suggestions for the prevention and governance of financial fraud.Research findings: first,*ST BaiTe’s fraud means mainly include fictitious overseas engineering projects,fictitious building materials export trade,fictitious domestic building materials trade.Companies construct "real" logistics information through freight forwarders while faking contracts and using controlled companies to create the illusion of repatriation of funds.Fraud means are relatively complex,involving information flow,capital flow and logistics fraud at the same time,with high cost and great difficulty in identification.Second,based on the GONE theory,it reveals the motivation of *ST BaiTe’s fraud from the perspectives of greed,opportunity,need and exposure.Among them,the specific performance of the greed factor is *ST BaiTe’s management ethics is not good,financial staff’s professional ethics level is not high;A dominant shareholding structure,the virtual board of directors,the board of supervisors,the failure of internal control provides an opportunity for *ST BaiTe financial fraud;Demand factors are mainly reflected in the pressure of performance commitment and the need for external financing.Market supervision is not perfect,intermediary institutions are not diligent and responsible,fraud cost and fraud income imbalance result in a low risk of financial fraud exposure.Under the action of these factors together,*ST BaiTe desperate,began the financial fraud.Third,in view of the causes of fraud,put forward financial fraud prevention and governance countermeasures and suggestions.In view of the greed factor,through the construction of corporate culture practice mechanism,strengthen the management and financial personnel of the professional ethics to improve the moral concept of employees,in order to achieve the purpose of curbing greed.For the opportunity factor,the company can optimize the shareholding structure,improve the board of directors,the board of supervisors system,improve the internal control implementation mechanism to achieve the goal of reducing opportunities.In terms of demand factors,*ST BaiTe can reduce adverse demand by making sound performance commitments,expanding financing channels and formulating reasonable expansion strategies.For the exposure factors,the regulatory authorities can strengthen the supervision of listed companies and intermediary institutions by establishing a multi-department joint supervision mechanism,building a multi-level supervision system and other ways,and meanwhile increase the punishment and introduce legal accounting to increase the risk of fraud exposure.