A Case Study Of Financial Fraud In Fushun Special Steel Co.Ltd Based On GONE Theory

The financial fraud of listed companies has always been a topic of controversy and concern,especially for large state-owned listed companies.Financial fraud case of Fushun Special Steel Co.,Ltd.is a typical case of mixed reform of state-owned enterprises in recent years.These cases not only brought huge losses to investors,but also had a serious negative impact on the reform of state-owned enterprises.Therefore,conducting research on the financial fraud case of Fushun Special Steel has certain theoretical significance and important practical significance.On the one hand,it can enrich the research content in the field of financial fraud in my country's listed companies and provide typical case support;on the other hand,it can provide a basis for reference for the policy formulation of the regulatory authorities,and at the same time,it can help listed companies in the mixed reform to prevent financial fraud,provide reference for improving the level of corporate governance.This article uses case study method and literature study method to research on financial fraud incidents of Fushun Special Steel.After a detailed description of the case,this article analyzes its fraud motives based on the GONE theory.from the perspectives of greed factor,need factor,opportunity factor and exposure factor,and then studies Fushun Special Steel's financial fraud.The various methods of financial fraud further propose governance countermeasures for Fushun Special Steel from the four factor levels of GONE theory.Finally,based on case analysis,the article puts forward governance enlightenment for enterprises,regulatory authorities and third-party intermediaries.The main research conclusions are as follows:(1)The main reasons for the financial fraud of Fushun Special Steel Co.Ltd.are: The management of Fushun Special Steel has poor moral quality and weak legal awareness;out of the need to avoid the company's delisting and ensure the company's normal development;Irregular governance structure,failure of internal control,and the recycl ability of special materials in the industry;the company's internal audit is in vain,external audit and supervision are ineffective,and the supervisory department is insufficiently performing duties;(2)The common methods of financial fraud and fraud include: inflating inventory,construction and depreciation,reducing the carryover of main business costs and inflating profits;(3)The company's financial fraud management can start from the following aspects: a diversified employee performance appraisal system should be established,and employee personal credit files should be established;Fushun Special Steel's high-tech manufacturing capabilities should be improved,and sales methods should be increased and done well.Cost control;establish a special steel use control mechanism,strengthen the functions of independent directors and the board of supervisors;strengthen the supervisory role of the party organization and establish a firm rotation mechanism;(4)The main enlightenment of this case is that Listed companies should improve the internal governance mechanism of the board of directors and the board of supervisors,the supervisory department should increase the cost of fraud,and the third-party intermediary firm should be diligent and responsible.