Research On Financial Fraud Behaviors And Countermeasures Of Manufacturing Enterprises

With the continuous development of the economies,the types of corporate financial fraud are becoming more and more diversified,and the harm caused by them is getting deeper and deeper.This phenomenon seriously interferes with the normal business order of the securities market,leading to the collapse of corporate reputation,even bankruptcy liquidation,which will also affect investors’ confidence in the market.At the same time,the diversification of fraud forms makes the supervision of the regulatory authorities more and more difficulties,domestic and foreign financial fraud cases have become more and more frequent.According to the domestic market,in recent years,news of listed companies’ accounting fraud has been frequently exposed.In order to deal with this problem,our government departments have taken a series of measures,but the result is also a drop in the bucket,and fraud cases are still repeated.Therefore,the analysis of the identification,motivation and countermeasures of financial fraud still has practical significance.Based on the previous research,this paper sorts out the listed companies that have been punished by the China Securities Regulatory Commission and the Shanghai and Shenzhen Stock Exchanges in the past five years.Based on the characteristics found in the sample,the paper analyzes the current situation of fraud in China’s manufacturing enterprises.And this paper selects Kunming machine tool as the case study object,analyzes the company’s financial fraud process,means and fraud motivation.Finally,based on the results of the analysis,the author proposes corresponding countermeasures for the internal governance and external audit of financial fraud in listed companies from both internal and external perspectives.This paper finds that the common fraudulent means of listed companies in manufacturing is the means of information violation disclosure.Moreover,the financial fraud of China’s manufacturing enterprises usually chooses a variety of fraud methods at the same time,and there is a certain continuity during fraud.Most of the regulatory penalties in China’s securities market are lagging behind.In addition,there are widespread loopholes in the corporate governance structure and internal controls of manufacturing companies with financial fraud.The fraud methods used by Kunming Machine Tool are mainly three points:inflated income,false increase in profits and false disclosure.From the perspective of risk factor theory,the main cause of the fake counterfeiting of Kunming machine tools is as follows.First,the company’s top management has a greedy mentality.Second,the company is facing delisting pressure and refinancing pressure.Third,the corporate governance structure is unreasonable,and the company’s internal control has major flaws.Fourth,the audit of external accounting firms did not raise vigilance.Finally,the SFC’s penalties are weak.In response to the above research,the author proposed measures to prevent it from several aspects.First,companies should improve the company’s governance structure and optimize its internal regulatory systems and environment.Second,the CPA should do a good job in understanding the industry before the audit.During the audit process,professional suspicion should be maintained,and the audit procedures used should be further improved to improve their professional ability.In addition,external regulatory agencies should establish a reasonable legal system and strengthen enforcement of regulatory authorities.