Case Study On Financial Fraud Of Jiangxi Baile Grain Co.,Ltd

With the rapid development of the new third board market,the new third board market has become the main force of China's OTC capital market.However,due to the rapid development of the NEEQ market,a series of problems in the NEEQ market have gradually been exposed.For example,the quality of enterprises on the New Third Board is uneven,many companies lack a sound internal governance mechanism,and the establishment of various rules and regulations on the New Third Board is incomplete.At the same time,in recent years,there have been frequent incidents of violations of companies listed on the New Third Board,including financial fraud.Financial fraud has brought great harm to the capital market and the entire society since the emergence of the capital market.As a part of China's capital market,the NEEQ market cannot escape its harm.In recent years,domestic and foreign scholars have been very rich in research on financial fraud,but most of them are based on listed companies on the main board,and there are few case studies on the new third board market.After all,the new third board market is different from the main board market,and research on financial fraud in the new third board market seems very meaningful.This article selects Baile Grain Co.,Ltd.,which was penalized administratively in May 2019,and takes the company's financial fraud incident as an example to study.It is hoped that it can reveal some problems existing in the main bodies of the new third board market and attract the attention of all parties.This paper uses a combination of literature analysis and case analysis to conduct research.This article introduces the theory of the cause of financial fraud,and sorts out and analyzes the relevant documents of financial fraud.Based on this,the research on the financial fraud incidents of Baile Grain is carried out,and the theory of fraud risk factor is selected to apply from the theory of fraud risk factor.The five risk factors are used to analyze the causes of the financial fraud of Baile Grain.After researching in this article,it is found that the financial fraud measures of Baile Grain are false increase of assets,income and concealment of liabilities.Regarding the causes of financial fraud in the Baile Grain,the low moral quality of the company's managers has increased the possibility of financial fraud.The company's huge financing pressure has constituted fraud motives,the company's internal governance structure is unreasonable,its internal control system is incomplete,and the New Third Board Insufficient related legal systems have provided opportunities for Baile Grain's financial fraud,and the failure of the sponsoring brokers and audit institutions to perform their supervisory duties has made it less likely that Baile Grain's financial fraud will be detected,and regulatory authority's punishment is too weak to produce deterrence,which further increases the possibility of financial fraud of Baile Grain.In the end,this article reveals some of the enlightenments brought about by the frequent occurrence of fraud incidents of the New Third Board to the main body of the parties of the New Third Board,based on some problems found in the financial fraud cases of Baile Grain.As a small and mediumsized enterprise,it is necessary to establish a reasonable internal governance mechanism,internal control system,and formulate an appropriate development strategy.As a regulatory agency,we must invest more energy in the NEEQ market and conduct strict supervision.As the hosting broker and audit cabinet,we must perform our duties diligently and conscientiously,and continuously improve our professional competence.As a legislative body,we must constantly improve the construction of relevant laws and regulations.It is hoped that all parties can make some changes to jointly promote the healthy and orderly development of the NEEQ market and the entire capital market in China.